I see that Yamaha electronic piano's have KB-model's, PSR-'s, DGX-'s, etc. Is there any difference between these lettered models, and why are they separated in this way?

I'd better answer that,

The KB series is for performance instruments, and its convenient operation panel provides users with a simple and quick operation interface.

The PSR series is a symbol of functionality and quality, offering more and more realistic tones, more popular rhythms, and a multi-track recording system, but the lower-end electronic pianos below the PSR540 are incredibly cumbersome to operate due to the lack of user-customizable user panel settings.

The DGX series is a simplified board for YAMAHA's electronic pianos above the PSR540 model, and is known for its low price and more entertaining features, but it won't make it into a professional studio.