To what end, Joe?
That's what I don't understand.
DPRK knows that if they go nuclear, we'd respond.
In the end, hundreds of thousands would be dead.
To what end? What would that accomplish for DPRK?
They believe they can only survive by coerced reunification with the South.
To that end, remaining U.S. forces must be ejected to "liberate" South Korea from "occupation".
They have been preparing for nuclear war since 1953 when Eisenhower quietly threatened to escalate to nukes if they didn't agree to the truce.
They literally have nothing to lose. Their nation looks like a moonscape. South Korea is one of the largest economies on the planet, Seoul is the size of NYC and 20-30 miles from the border, and Tokyo, capital of the second largest economy on the planet, is in range of their extended SCUDs. They can blackmail South Korea, Japan, the global economy at large (not to mention the 70-80,000 US military in South Korea and Japan along with 100-150,000 civilians) by threatening to rain down sarin, VX, tabun, anthrax, plague, smallpox, and perhaps weaponized avian flu, not to mention nuclear warheads, on all of the above.
If war starts, they will hope to drag China into the war on their side by forcing Japan to retaliate and attack North Korea. China is obligated by their mutual defense treaty to come to North Korea's aid if attacked. Many believe China will not intervene directly, but as many of the missile bases are positioned up near the Chinese border along the Yalu, American and Japanese forces will be forced to approach the Chinese border to neutralize the missile threat (which will be difficult from the air).
Thus, MacArthur's error would then be repeated by triggering a Chinese intervention. But China in 2006 is not China in 1950. Top Chinese generals have already stated they are ready to wage nuclear war over Taiwan. If China come into direct military confrontation with America on the Korean Peninsula, they will not be restrained from seeking to coercively reunify Taiwan with the mainland just as North Korea will try with the South.
North Korea, with Chinese assistance, may then threaten a launch on the U.S. if we do not sit down and negotiate a peace settlement that brings Taiwan into the Chinese orbit and South Korea into North Korea's. Our missile defense may (or may not) work against a limited North Korean attack. But far less likely against a full-on Chinese attack.
North Korea cannot win conventionally, but hopes to use nuclear weapons (or threat of their use) to coerce a settlement, and if that fails, to widen the war to bring Japan into conflict with China (who hates Japan) and forcing a situation where US/Japan fight China/North Korea.