Some people use it for large planted aquaria because it's cheaper than the fancy substrates that get expensive in large amounts. You can get small boxes of Laterite at Petsmart or other stores that sell planted aquarium stuff, and given that kitty-litter grade laterite, if it's pure at all, isn't intended for plants, I strongly suggest buying horticultural grade laterite from a fish store. I think it's.... 20 dollars for a 5 pound box or something like that. I think I remember them talking about how hard it was to fine usable kitty litter and then it turns to mud after awhile. Maybe if you combined it with another mineral and collected the precipitate it would be less soluble.
I've used Fluorite before and it works pretty well and has a nice red/black color ^_^ You'd have to wash it a lot before you use it, but it's loaded with iron.