So this might be a dumb question, but what exactly is the Kerrat system, space war zone supposed to be? and why are the borg in that sector?

The Borg have made a presence in the Federation-Klingon Neutral Zone in Eta Eridani Sector Block, and the Federation has to stop them from having a foothold so close to Federation space.

However, occasionally, Klingon players are there too, trying to pillage Borg technology. So the Federation has to stop them as well, thus it is a warzone within the Federation-Klingon Neutral Zone.

Similarly, there is a ground warzone at Otha System in the Federation-Klingon Neutral Zone in Eta Eridani Sector Block, and as wtih Kerrat, there may occasionally be Klingon players there too, thus another warzone.

its meant to be a cross between a pve and pvp map.

so complete the pve objective before the other team and defeat any players you see.

sounds great but did not work very well, so they plan to change it.

who knows why the borg are there. they just felt like assimilating the place.