You need to make sure that your geometry is some sort of mesh and that you're writing kmz files not kml itself.You should also introduce an AppearanceStyler prior to the AppearanceSetter for defintion of your texture information.
Textured objects are stored as collada files that are referenced and placed by a master kml file.The FME OGCKML Writer is able to write such kmz files.Make sure that in Advanced settings of KML writer the parameter "Write 3D Geometry As Polygons" is set to "no".This triggers the collada/kml writing.