They overlap, but none does strictly more than the other.

Kaitai is for describing, encoding and decoding file formats. Wuffs is for decoding images (which includes decoding certain file formats). Kaitai is multi-language, Wuffs compiles to C only. If you wrote a parser for PNGs, your Kaitai implementation could tell you what the resolution was, where the palette information was (if any), what the comments look like and on what byte the compressed pixel chunk started. Your Wuffs implementation would give you back the decoded pixels (OK, and the resolution).

Think of Kaitai as an IDL generator for file formats, perhaps. It lets you parse the file into some sort of language-native struct (say, a series of nested objects) but doesn't try to process it beyond the parse.