I did do a couple tests, and they're mostly inconclusive since they would require more trials, but I noticed it could have had something to do with the target(s) in the circle or maybe the map or (I think) just dumb luck.
Test 1: Scorching Earth casts in SE Forest (no targets in the circle upon casting) 100 casts.
Test 2: Scorching Earth casts in Path to Oops (1 or 2 targets initially per cast) 50 casts.
Test 3: Scorching Earth casts in Fiesta Moa Stone map (random # of targets but mostly over 5 each time) 25 casts.
This probably just proves that it's failure rate is completely random (as in static and you cannot affect it) haha.
As for the LK stat, yes, if the monster has more LK than you, Scorching Earth will deal 0 damage (miss) since I don't think it was designed to display "miss".