Game: 282531552. As per screenshot attached. I don't see second ability available. Flute is on Karn. I don't see any other reason why it wouldn't work...
I should be able to change any of 2 Kolaghan's targets to Spellskite as it is both artifact and a creature (pay for each separately). There are many rulings on this already available. In MTGO I cannot do that though. Cost me some games already...