If we look at a very high level sketch of what a dynamic cluster system look like (https://speakerdeck.com/jbeda/containers-at-scale?slide=5) I think that CoreOS fits in at the "Managed Base OS" level.
Kubernetes is a Cluster Scheduler and a "Node Container Manager" (called the kubelet in Kubernetes).
(This deck is pre-Kupernetes. The python agent that we released will be replaced with the kubelet at some point soon.)