Knee push-ups are fine. Inclines are also good.
Another option that I use for someone who is in between the ability to do a full push-up and a knee push-up is to do the eccentric phase (the “down”) from a full push-up position, drop their knees, then do the concentric phase (the “up”) from the knees. Since we’re typically stronger eccentrically than concentrically, it’s a small progression to help someone move beyond doing knee push-ups forever.
Like most other exercises, this exercise has a ‘utility’ under the right circumstances. Used as a modification or as a progression for a client needing either, this exercise can be good.
I will use knee push-ups occasionally–I feel that they are appropriate for many people with limitations. I do prefer, however, to try an incline position first to engage the chest and the core more. I also agree with Nancy on the eccentric phase of the pushup–have them on their toes to lower down if they can and then drop to their knees for the concentric phase up.
All said and done, it will really depend on your client.