  We use moderate-resolution spectra of nearby late K and M dwarf stars with
parallaxes and interferometrically determined radii to refine their effective
temperatures, luminosities, and metallicities. We use these revised values to
calibrate spectroscopic techniques to infer the fundamental parameters of more
distant late-type dwarf stars. We demonstrate that, after masking out poorly
modeled regions, the newest version of the PHOENIX atmosphere models accurately
reproduce temperatures derived bolometrically. We apply methods to late-type
hosts of transiting planet candidates in the Kepler field, and calculate
effective temperature, radius, mass, and luminosity with typical errors of 57
K, 7%, 11%, and 13%, respectively. We find systematic offsets between our
values and those from previous analyses of the same stars, which we attribute
to differences in atmospheric models utilized for each study. We investigate
which of the planets in this sample are likely to orbit in the circumstellar
habitable zone. We determine that four candidate planets (KOI 854.01, 1298.02,
1686.01, and 2992.01) are inside of or within 1-sigma of a conservative
definition of the habitable zone, but that several planets identified by
previous analyses are not (e.g. KOI 1422.02 and KOI 2626.01). Only one of the
four habitable-zone planets is Earth sized, suggesting a downward revision in
the occurrence of such planets around M dwarfs. These findings highlight the
importance of measuring accurate stellar parameters when deriving parameters of
their orbiting planets.
