Don't mistake literally language with the languages spoken by people. In much of Europe Latin was literary language, for example. In what's today Ukraine, Belarus, Russia, Slovakia Old Church Slavonic was literary language only.
It is understood that Old Church Slavonic is old Bulgarian. In the case of Ukraine, Russia, Belarus Old Church Slavonic was adopted. It wasn't as similar as OCS in Bulgaria during that time.
In Polish it is also 'na Ukrainie'. The term comes from the days when Ukraine was not a recognised separate state. Many Ukrainians go to Poland. There ,they teach Poles to say 'w Ukrainie'. Just like Russians certain Poles are getting annoyed over it.
However, Rus' was a recognised state. Yet, it's 'na Rusi'.
I think when people said 'na Rusi', they meant "on the land that is Rus", not "inside a country of Rus". There is a subtle difference here.
Also, as have been pointed out already, "Kievan Rus" is a made up term. "Kievan Rus" was already in decline at the time of Nestor, and would pretty much fracture and disintegrate ~20 years after the Primary Chronicle was written into separate principalities.