Promising piezoelectric properties have been reported in lead-free potassium sodium niobate-based ceramics by introducing Bi0.5(Na0.82K0.18)0.5ZrO3 (BNKZ) into K0.48Na0.52Nb0.95Sb0.05O3 (KNNS) solid solutions in order to control the polymorphic phase transformation temperatures. In this work, high-resolution synchrotron x-ray powder diffraction (SXPD) was employed to investigate the phase coexistence, whereas high-energy x-ray diffraction was used to observe the electromechanical response for KNNS-BNKZ ceramics. High-resolution SXPD measurements confirmed that the addition of BNKZ in KNNS ceramics caused an increase of the rhombohedral-orthorhombic phase transition temperature (TR-O) and a decrease of the orthorhombic-tetragonal phase transition temperature (TO-T), leading to the occurrence of orthorhombic-tetragonal and rhombohedral-tetragonal coexisting phases at room temperature. Moreover, core-shell microstructures were observed due to chemical heterogeneity for BNKZ-containing compositions and led to the presence of weak shoulders in the temperature-dependent SXPD profiles due to the difference in lattice spacing between K-enriched core and K-deficient shell regions. To improve the homogeneity, different methods, double calcination and attrition milling, were used to produce the KNNS-BNKZ ceramics. However, the presence of core-shell microstructures was still observed for the KNNS-BNKZ ceramics produced using both methods, with the enhancement of grain size in comparison with the ceramic using single calcination. In terms of domain-switching behaviour, the in-situ XRD patterns showed that the preferred orientation was very weak after initial poling, but it was dramatically enhanced after ageing for one day, leading to the increase of lattice strain. This may occur due to the occurrence of internal stress, generated by the mismatch between core and shell, which possibly induced ferroelectric switching of non-180 degree domains after ageing. In addition, the occurrence of polarisation rotation from the initial direction toward the orthogonal poling direction was illustrated in a shear-mode study using an applied cross-poling field.