Is there an advantage to using higher dimensions (2D, 3D, etc) or should you just build x-1 single dimension classifiers and aggregate their predictions in some way?
This depends on whether your features are informative or not. Do you suspect that some features will not be useful in your classification task? To gain a better idea of your data, you can also try to compute pairwise correlation or mutual information between the response variable and each of your features.
To combine all (or a subset) of your features, you can try computing the L1 (Manhattan), or L2 (Euclidean) distance between the query point and each 'training' point as a starting point.
Since building all of these classifiers from all potential combinations of the variables would be computationally expensive. How could I optimize this search to find the the best kNN classifiers from that set?
This is the problem of feature subset selection. There is a lot of academic work in this area (see Guyon, I., & Elisseeff, A. (2003). An Introduction to Variable and Feature Selection. Journal of Machine Learning Research, 3, 1157-1182. for a good overview).
And, once I find a series of classifiers what's the best way to combine their output to a single prediction?
This will depend on whether or not the selected features are independent or not. In the case that features are independent, you can weight each feature by its mutual information (or some other measure of informativeness) with the response variable (whatever you are classifying on). If some features are dependent, then a single classification model will probably work best.
How do most implementations apply kNN to a more generalized learning?
By allowing the user to specify their own distance matrix between the set of points. kNN works well when an appropriate distance metric is used.
I think that depends on the data. If you know your feature is bounded, you could scale it to $[0,1]$. If it's binary I guess $\{0,1\}$ is a good choice, perhaps $\{-1,1\}$. Now, if it's unbounded, the standardization to $\text Z$-scores $\overline x = 0$, $\sigma=1$ is a reasonable choice.
Best Answer
The k-nearest neighbor algorithm relies on majority voting based on class membership of 'k' nearest samples for a given test point. The nearness of samples is typically based on Euclidean distance.
Consider a simple two class classification problem, where a Class 1 sample is chosen (black) along with it's 10-nearest neighbors (filled green). In the first figure, data is not normalized, whereas in the second one it is.
Notice, how without normalization, all the nearest neighbors are aligned in the direction of the axis with the smaller range, i.e. $x_1$ leading to incorrect classification.
Normalization solves this problem!