Well my opinion is that he wants a nuclear arsenal to protect his dynasty from being overthrown in the same way that Gadaafi was. I assume that Kim is actually a very intelligent man and even if he believes his own bravado, will know that the use of a nuclear/conventional weapon on South Korea/Japan/US territory would result in the entire world (including maybe even China) deciding that he needed to be removed ASAP. This is not a battle that he would want.