As far as culture goes, you can see from several blogs on the internet that the culuture at KAUST is nothing like the culture elsewhere in Saudi Arabia, the rgular laws and rules of SA dont apply in there. There are several westerners living in KAUST and a simple google search will turn up several blogs with their views on living there. KAUST has its own film theatre, swimming pool, diiving/scuba, kayaking facilities and stuff.
As far as your second question is concerned if you look at the EE page on the KAUST website you will see that they have collaborations with and professors from Stanford, MIT, Caltech, Purdue , GA Tech, EPFL etc. The labs mentioned on the pages had MS students who are currently pursuing their PhDs from places like McGill, GA Tech and other US/European univerisites.
Hope that answers your questions