The kind of players I play against ($15/$25 tables) would 90% of the time had KQ if they made that post-flop bet, 5% of the time K5, 5% of the time 27o. So maybe I'm not in a position to question this!

However - his bet after the turn is the key here, I think. He's already been happy to go to $7, and that's when you were setting the pace - why only $10 if he's got a straight, or even if he has KQ and is therefore looking even less vulnerable?

I'd probably have gone all in after his $10 bet, for the above reason - it just smells of scare tactics rather than real strength. That is, of course, if I'd stayed in, which is doubtful after his raise to the flop - if he was so unpredictable and talented, maybe I'd have just cut my losses.