As of the time of this writing, Google does not provide a USB driver (for Windows) for the Nexus 5. The usual link (http://developer.android.com/sdk/win-usb.html) shows Wind
I was lost at first as well but found a fairly easy solution. Please note that I did all this on Windows 7 after enabling Developer Options and USB debugging on my Nexus 5 (on 4.4.2), then connecting it to my PC via USB.
If you go to the download link - http://developer.android.com/sdk/win-usb.html - you'll notice at the bottom in step 4, the installation location of the driver. If you then navigate to Devices and Printers from Control Panel and find your device, right-click and go to properties, then click the Hardware tab at the top, click the device displayed that is having issues, click properties, then Change settings. Next, select Update driver, choose the location manually, and choose the directory Google noted as the installation directory, which they noted as \extras\google\usb_driver\
This fixed the problem for me and my Nexus 5 now appears in DDMS.