No matter what way the wind blows, you're going to have fallout on a country we don't want to **** off. It's only 100 miles to SKorea and even less to China. Although we do have the capability, the world wouldn't like it very much if we did.
And if we did nuke Pyongyang, the North would engage it's artillery... it's estimated that within just a few hours, every city/town/village within 20 miles of the border will be on fire, completely destroyed, or underneath a cloud of chemical gas, and they've got guns with enough range to hit Seoul... which you can be assured they'll save their "special" ammo for.
They've also got some fairly bad-*** SOF types that train for missions aimed at specific towns/villages where they infiltrate from submarines or air-drop, hit the town, kill everybody, and destroy/cripple the infrastructure there.
The US forces there are not unprepared in the least, but at last count (no matter how inept they may be), the North has about a million people active in their army, but since miltary service is mandatory, EVERY SINGLE ADULT MALE in the whole country has been trained as a soldier (they're all technically reservists), they would completely control the south in a few days if they marched. If it came down to giving each one a gun and marching them across the border, the 20,000 or so we have there isn't going to slow them down much. The South has a decent enough military (like 500,000 soldiers), but it just comes down to sheer numbers.
If it comes to actual war, millions will die (lots of Americans), millions will flee to China (who may take sides with the North), gas prices will skyrocket, Japan will FREAK THE SHIZ OUT, we'll be the bad guys if we use nukes even if they use them first, the South Korean economy will go instantly into the crapper, which will destabalize world markets, etc... a chain reaction of epic suckage.