-- Nick Jenkins
The separation between a technical knockout and a knockout comes straight from the boxing world. When a fighter is knocked down and unable to rise before the referee's ten count, he has been knocked out. If the bout is halted and that fighter is unable to continue for any other reason -- be it a cut, an injury, or not being able to defend himself -- he has been technically knocked out. Although a TKO tends to somehow be viewed as being of lighter significance than a pure KO -- as reflected in your questioning of whether "Babalu" was “technically” knocked out -- it is often the case that many TKOs in the boxing ring are far more brutal than a KO, as a fighter who has been brutally starched will often not get the benefit of a full count, with the referee waving a bout off immediately, resulting in a TKO.
And so, we come to MMA, where for whatever reason, TKOs and KOs are both used despite not being able to hold the same clear and logical distinctions they have in boxing. Since MMA, at least in 99 percent of its forms, doesn't have a knockdown count, the actual “true” difference between a KO and TKO can't really be observed. By the boxing standard, any and all stoppages in MMA would be technical knockouts.
Personally, despite being the current overlord of the FightFinder, I have no hardline take on the subject. If, for instance, athletic commissions the world over wanted to create a new universal notation for referee stoppages in MMA, I'd be hip to it. However, I have noticed that my own use of KO and TKO in the FightFinder -- though perhaps not deliberately -- has come to reflect a representation of action. In the past, I have unconsciously reserved the KO distinction for bouts which end as a direct result from a clear and distinct strike or strikes from the standing position that instantly removes the opponent from the fight. TKO’s fill in the gaps beyond that, whether it is a fighter getting dropped and flurried to a finish, straight ground-and-pound, and so on.
I've probably gravitated this way because somehow, it is the best way to be visually representative of a fight finish with just a little bit of text. But, that's not to say it’s “right.” This distinction and virtually any other between KOs and TKOs in MMA are subjective and ad hoc at best. And, unfortunately for fans, a system which seeks to explicate the brutality of a fight finish via official notation is unlikely to catch on.