I personally do not eat back my exercise calories - that is why I do not track it on MFP...but there are alot of people that do. Some people can do great and keep losing weight by eating back some or even all - but there are others that find they cannot and have to limit it. You really will not know unless you try.

But I also need to kick-up my exercise since I started Keto....I did not quite have the energy to really go full speed ahead (I started Keto in June). I have recently just joined the gym and bought a kettlebell and some dumb-bells and Sept is when I will have NO MORE EXCUSES!!! (Well - I am sure I will, but I am going try and not listen to those voices in my head - lol!!)

Yes, I do. But it depends on how you calculate TDEE.
First, I like this site: http://iifym.com/tdee-calculator/ which gives BMR and TDEE. The basic premise is that you determine TDEE and then set calories to TDEE - 20% (take 80% of that number). That means you will be at a 20% caloric deficit. That's really safe, and will ensure you lose regularly without killing your metabolism.

the two options:
1) Enter how much you exercise for activity. With this approach, your daily calories will be higher. You will eat the same amount every day, and you don't eat back calories.
2) Use sedentary for the basis of your TDEE and BMR. Take the 80% of your TDEE as your calorie target. Your daily calories will of course be a lower number each day than it was for option 1. But now, when you exercise, you should eat calories back. You are already at a deficit after all - no need to drop even lower.

I much prefer option 2. If I do option 1 and I miss exercising that week, it will have overestimated calories. Or if I exercised extra, it will have underestimated. Going option 2 will be more accurate based on what you really do. Plus, it makes sense to me that if I exercise more, then on those days I get to eat more.

One note - when I calculate my TDEE -20% at sedentary,it's lower than my BMR. You don't want to set calories lower than BMR. If TDEE - 20% is lower than your BMR, just use the BMR.

And a final note. I actually calculated out my weekly calories using the two methods. Amazingly, for me, they were exactly the same. So again, it comes down to preference,mand I just prefer option 2 where I do eat back calories.

You can also use the keto calculator, which builds TDEE in.
http://keto-calculator.ankerl.com/

Also - if you used MFP to calculate target calories, same thing applies.

I don't see any reason not to eat most if not all of your exercise calories then, unless you don't believe you really burned as much as MFP gives you. After all, you're already calculating a deficit. If you don't eat your exercise cals, then you are going below a 25% deficit, if you think about it mathematically.

I am to eat back about 20% of my exercise-earned calories. I heard that recommended on a podcast I listen to. It said it's dangerous to not eat back any, because then you're likely putting yourself into starvation mode -- but at the same time, you want a deficit so you don't want to eat them all back. So as a rule of thumb, if you eat back about 20% of them you should be golden.

I generally try to stay below the original goal and treat exercise as a bonus.

I rarely do, first of all because I only have between 100-300 calories from exercise per day at the moment (not exactly a lot just yet) and secondly because I'm using "lightly active" and am really rather between "sedentary" and "lightly active", so I just use my exercise to justify my "lightly active" settings I'm in no rush when it comes to losing weight, even though I now eat about half of what I used to eat (plus in ketosis of course), so pounds should drop no matter if I eat 100 calories more or less

TDEE is TOTAL DAILY ENERGY EXPENDITURE.

that's BMR *plus* exercise.

to lose body fat healthily, you subtract 10 to 20% from your TDEE, not your BMR. Your BMR is what you would need to sustain healthy organ function if you were in a coma. Your body naturally burns this many calories over the course of a day (approximately 1,440 minutes)

so if your BMR is 1200, you need to consume at LEAST 1200 calories a day.

Exercise is anything other than being asleep as far as BMR/TDEE goes. Walking to your car, fidgeting at your desk, chewing gum, running 6 miles, cycling 50 miles, swimming the English channel...

so if you burn 400 calories doing an hour of cardio, you need to realize those calories are IN ADDITION TO what you're already burning every minute just being alive. EAT THEM.