ze bulette asked, in the comments to my last post, "Incidentally, I hope things cool off over there. What's the vibe on the street where you live?"
To tell the truth, here in Busan there's little to no worry about war heating up between North and South Korea (and thanks, Sarah Palin, for putting me on the wrong side in the conflict!). Koreans aren't worried about it (angry about it, but not worried). Ignore CNN. They're just milking the exchange for ratings.
I do think the situation is a great way to add some conflict to a setting, however. Two nations with a similar culture but opposing philosophy, and bad blood because of an old conflict between them where they were both pawns of greater powers? Lots of campaign hooks there.
Throw in a despotic ruler on one side, who's anxious to make sure his son is accepted by the nobility/military elite as his successor so he's acting more belligerent than normal--sending his killbots/zombie hordes/orcs in raids across the border.
But neither side wants all out war. The despotic ruler's side would likely collapse from the over-expenditure a war would necessitate. The more open and free side would lose what little edge it's gained recently against the bigger powers in the world (or galaxy...).
That right there is a pretty good campaign background. Lots of simmering tensions that the GM can exploit as adventure hooks, and as consequences of PC actions.