The North Korean government scares me, because sanity seems to be in short supply. I think that is is possible that the goal of this latest feint is to draw concessions from the south Korean government in terms of loosening sanctions, etc. Or maybe the Beloved Leader is on the brink of death and they need a war to unite the people behind the new leader?
The trouble is that Seoul is close enough to the border for NK to deal a lot of civilian casualties and disrupt a lot of SK's economy with missiles. The SK government has actually started building a new political capital further south in part in response to this threat--but it's not anywhere near completely moved out of range. And there are still the lives and economic consequences to be thought of.
It would be highly irrational for North Korea to render chunks of Seoul, a city of great historic and emotional importance for Koreans, uninhabitable by using a nuke or 'dirty bomb' on it. But I sometimes fear that--like an enraged spouse in a divorce--North Korea's rulers would rather do something idiotic for themselves, as long as it hurts the other party. From this rather twisted perspective, a strike on Seoul "makes sense".
The truth is, even if they lob (non-nuclear) missiles into Seoul, the rest of the world is unlikely to perform a strike that will kill thousands of the wretched people of North Korea--who did not choose their government and are suffering greatly from its idiocies--so they might in fact get away with a relatively modest retaliation. And they know they have China's government and military backing them up, too, so the likelihood of them taking a big strike on Pyongyang is approximately zero.
I'm very concerned about this situation. So is Japan, who is conveniently in range and cannot by law take a first strike.