That’s not entirely true. The South has responded decisively to naval violations in the past and would probably lash out if it is pushed. Mushy sentiments aside, South Korea fears the impact of conflict on its economy. It’s the same reason nobody wants to do anything about Iran or Pakistan.
Response to naval engagements is one thing. They’re responding to point targets, who are entirely military.
If we’re talking counter-battery fire, there will certainly be civilian deaths and destruction. That’s where the ROK would hesitate.
The Norks, if they started a real “shock and awe” bombardment of Seoul would need a serious curb-stomp and that’s going to mean serious civilian deaths north of the DMZ. The ROK obviously fears the effects on their economy - that’s absolutely true. But when they could have starved the Norks to the table, they refused to do so. When they could have let the Norks freeze to death (or make it China’s problem), the ROK flinched.
Moral of the story: When your enemy is starving and freezing to death, you should *let* them starve and freeze.