The army is apparently in some grey area between loyalty and revolt:
Along the North Korea border, Chinese police are noting a sharp increase in North Korea military personnel coming across. The few that are caught speak of sharp cuts in their food supplies, and many senior army and political officials stockpiling supplies and sending their families to China, or even more distant safe-havens.
It seems like the lack of financial support is triggering a "fight or flight" reflex in the army. At this point, it seems like the army is willing to flee. The North Korean regime can't accept this problem in case it leads to really large-scale flight.
But if the North Korean elites halt the army's flight reflex, the elites might find that all they have left is the fight reflex. And if the regime tries to direct that fight reflex against the South Koreans, the elites might find that the lack of resources given to the army means that the army will know that going up against the well-armed and well-trained South Koreans is a death sentence.
The fight reflex could remain however, and be used against the only target possible--the regime itself.