He is not overplaying the sequester because when it happens, he will see to it that those services that affect the largest number of people in very visible ways will be cut.
He will cut TSA agents so everyone can see the long lines at airports on the TV news (they will gladly cover it for him). He'll cut the meat inspectors so meat processors have to close down and there will be no meat on the shelves. More TV coverage!
He could cut much less important things (Dept of Education, for example) but he won't. He will go full throttle public relations, nothing less. It will be a disaster of his own making - of course, he won't be blamed for it.
Precisely what he will do, which may just be his final move of desperation. Imagine these employees who would find out they lost their jobs because Obama threw a temper tantrum. It could get ugly.