The United States and South Korea evidently plan as scheduled to hold their war games despite North Korea attacking civilians.
South Korea's leader's called for massive retaliation against North Korea.
In my opinion these are good things, but double-edged swords. North Korea's dictatorship is the most triumphant example of brinksmanship and kleptocracy of the present day. They are thus for a damned good reason, a lot of people are starving there and even the most monstrous and repressive society can only remain such for a time before the bottom falls out.
I see nothing at all good coming of an actual war here. This is a case where reg'lar ol' artillery is a lot more dangerous than nuclear weapons. There is literally nothing the United States can do at this point to prevent the outright destruction of Seoul, and the destruction of of one of the top 10 global financial centers will plunge the world into a second recession that made the first one look like a pipsqueak. In my opinion this is yet another game of chicken where North Korea is simultaneously seeking for more aid via its usual blackmail system as it navigates a transition to yet another member of the Kim Dynasty. The DMZ was already two guys facing each other at point-blank range with flamethrowers. Now we're talking the same situation in a room soaked in fine dust.
In my opinion also the most dangerous moment for any authoritarian society and moreso for its neighbors is a succession. For North Korea it's infinitely moreso, it's the only contemporary society where the head of state is a dead man (insert Zombie Reagan jokes here). North Korea is also a poor state which is armed to the teeth surrounded by a bigger neighbor that never really had much love for it and props it up solely to delay a catastrophe bound to happen as it is, and on the other side it's surrounded by a rival Korean state and Japan.
The regime in part brings its siege mentality on itself and in part it does have a reason to fear the PRC and ROK (again by this point most of that was self-inflicted, as their invasion virtually wrecked South Korea far more so than applied to the North). But a society in a state of siege is the most dangerous society because to those, any atrocity can be deemed excusable in pursuit of basic security and protection of itself. Which of course is where the problem comes in, because there passes a point where those societies feel any concession on their part makes them weak and their neighbors are no longer able to concede anything either.
If Kim Jong Un takes over without any major war breaking out things will be the usual nightmare for a while longer. Until or unless the man's secure in power the perpetual potential flashpoint in Korea will remain something to watch closely, as the consequences just like in 1950 will not be limited to the Koreans alone (and even if they were they would still be evil).