You won't use a knife much if at all. I have a small, steel, blunt, with line cutter slot, serrated and straight blade, attached to my bcd with a hard sheath. It is small with a decent sized handle. Snaps nice into the hard sheath that is very secure and keeps it accessible but out of the way.
I tried a fold out knife but it was hard to get to, open up and ripped up my pocket. I know divers who dive with the 8"+ knife. I guess it makes them feel macho. You must be very careful with your knife, mine is extremely sharp.
If you take care of a steel knife (rinse, dry, WD40) it will last a long time. I considered getting a titanium but I felt that there is a higher chance in loosing it than any added benefit.
Kelp is easy to bend and snap and not to cut with a knife.