No, "Kubla Khan" is not an incoherent poem; it is a fragment. According to Samuel Taylor Coleridge, he experienced the poem in a vision while he was in an opium-induced sleep. The poem composed itself in his mind, complete with visuals, and was from 200 to 300 lines long, but when he woke up, he only had time to write down the first 36 lines before he was interrupted. Later, he couldn't recall the rest. Lines 37 - 54 seem to be of a different character and were probably not part of the words he dreamed.
Although the poem was composed in an unusual manner, it is completely coherent. The sentences are all syntactically correct, the poem is full of imagery, and an obvious rhythm and rhyme scheme are maintained. To compare, one could consider E. E. Cummings' poem "My Father Moved through Dooms of Love" (link below) to see how Cummings distorts language and syntax. Even in Cummings' poem, however, the praise of his father is the clear message, so it is not exactly incoherent. But Kubla Khan, in contrast, presents no such challenge to a normal reading of the text. The words and sentence structure are easily understood.
In fact, the imagery Coleridge uses is lovely. First the "pleasure-dome" is described with its walls, towers, and gardens surrounded by fertile fields and forests. Next the chasm, the river, and the fountain are described, and then the river that ran "five miles meandering with a mazy motion." The only human action in the scene is in line 29 where Kubla Khan hears the war chant. The final section seems to be an epilogue where the poet imagines himself in that place and wishes he could gain back his lost vision. The entire poem uses iambic rhythm and rhymes, sometimes in couplets, and sometimes in other patterns, that unify the poem.
Far from being incoherent, "Kubla Khan" is an intriguing fragment of a poem that the writer wished he could have completed--a sentiment with which generations of readers concur.