If China claimed NK as part of its rightful territory and had made repeated, explicit threats to annex it, by force if necessary, then I might consider such a rationale to be credible.

Otherwise, no.

Not that I ever want to defend no-dong Li'l Kim, but presumably lobbing missiles at Japan is internally justified as protection against US aggression. (The idea being that if they ever got the damn things to work properly they'd be aiming at the US bases here.)
The US has been hostile to NK since its creation (for good reason, of course), so if you squint at it from a nationalist point of view, you could argue that NK is only preparing its missiles to defend against an agressor that has threatened to conquer it.

NK having missiles is bad because they're ruled by a murderous madman and because that money should be spent on their starving people, not because there's anything wrong with wanting to defend themselves.

I read somewhere the argument that leaders we often dismiss as "crazy" (Kim, Ahmadinejad, and for the Democrats, George W. Bush) can't possibly be as whacked-out as we like to think they are. If they actually were insane, they would never have made it as far as they did. Surely a more intelligent coup-plotter or skillful politician would have taken control by now.

Counter-arguments often hold that the "crazy leader" is not really a leader: i.e., that Ahmadinejad is not really calling the shots in Iran; the mullahs are. (I'm not an Iran expert, and I can't say to what exent that's true.)

But Kim is certainly in charge of North Korea. So maybe he's not really crazy. An evil man who does cruel, senseless things to his own people, yes. But smart enough to treat as a rational actor for purposes of deterrence.

The big concern I have is Kim's ability to supply weapons to terrorists. For example, could he give a nuke to Al Qaeda members who send it to a US port in a shipping container, with a "martyr" packed inside to set it off?

I don't know if that's technically feasible, but if it is, it's something I could actually see Kim doing, as opposed to launching direct nuclear strikes at the US or Japan.

North Korean nuclear materials could find their way into terrorists hands, but the far more likely scenario is that their missile technology would be used to arm Iran, which would develop the nuclear warhead on its own using Pakistan's designs and, probably, assistance.

These countries could in turn arm terrorists, but that scenario seems a little suicidal on their part.

Algeria is also reported to be working on a bomb and would seem like a country that could pay the kind of cash North Korea needs.

These risks point again to disastrous consequences of the "Bush doctrine" and the invasion of Iraq. The invasion sent a clear message to enemies of the U.S.: don't both working with the U.N. or the IAEA weapons inspectors in a way that may ensure your survival. If some U.S. think tank decides your toast, the U.S. regime is going to come after you and will lie, mortgage itself and redirect essential military resources to do so. You are much better directly pursuing nuclear and other WMD, staying away from international mediation and knowing that you will be secure from the U.S. if and only if you have the weapons and military that would make an invasion too costly for the U.S.

If Kim is a serious weapons proliferation threat, and the evidence surely suggests he is, the U.S. needs to step directly away from fantasies about regime change. The problem is, as long as the Cheney-Bush crew is in control, North Korea and the international community cannot trust the U.S. to reasonably act in self-defense, rather than acting on some messainic vision of taking out nasty characters like Kim "dead or alive" etc.