I don't think it has anything to do with the media 'playing it up'. The facts are like you say, only more so: North Korea has severed all ties with South Korea, including the Red Cross contact point at the border; N.K. has expelled all S.K. officials in N.K. (associated with a joint project); N.K. has stopped allowing S.K. to fly over its borders (as has S.K. to N.K.). S.K. has termed N.K. as its 'principle enemy' (a legal designation in S.K.). Etc, etc etc.
However: this has all been done before; I think the last time in 1994. The difference between then and now is China is more tied to the West now than it was back then, and China (as then) has no desire to see the two Koreas resume the war.
I imagine that a 'hot war' will not break out, but that N.K. will do something 'privately' to save face (i.e., concerning the sinking of the S.K. ship by the N.K. sub).
Given the famines I can't imagine that North Korea's soldiers are in that good a shape. China has been providing food, but not enough to feed the country.