it absolutely is, and it's ridiculous for people to think otherwise or argue about, or that it's somehow not government sanctioned. Same goes for the gigantic flags that are on display on either side of the border. The North Koreans are obsessive about not being shown up by the "imperialists", and have even showfully walked out of meetings in the DMZ because there was a disparity in the size of flags, or their soldiers were not tall enough, or there was some other very arbitrary breach of protocol. Only to come back with taller soldiers, bigger flags, and more attitude.
Of course, it takes two to tango, and the Americans and ROK Koreans are more than happy to play the game of flag waving, most notably in what ended up as Operation Paul Bunyan, when the simple desire to clear some trees from blocking a Southern outpost ended up with a group of North Koreans starting an axe-fight in the DMZ and killing an American. None of the Americans or ROK wanted to go to war over the death of one soldier, but goddamn were they were going to finish cutting down that goddamn tree, so the natural response was to launch what was at the time the largest military operation since D-Day. Aircraft carrier groups were brought in range and on standby, B-52s were in the air, helicopters were waiting in the air just beyond the hills all in support of a couple of trucks of Koreans and Americans and their chainsaw. There's a first-hand report linked to in the references section on wikipedia from this describing how weapons were smuggled in the back of the trucks and, in an attempt to provide cover while minimizing the potential for gunfire, some of the Koreans had strapped claymore land mines to their chests and stood on the bridge taunting and screaming like lunatics while the whole tree, and not just the offending branches, was cut down. All this for a damn tree branch!
The trees in this article, while much less dramatic, are no different. It even says as much and doesn't just hint at it -- they are not actually trees but 30 meters-tall metal structures in the general conical shape of a tree, built on top of a hill just 3 km from the DMZ. It's tall enough, on top of a hill enough, and bright enough to be visible across the border from a city which cannot be supplied with electricity all the time, and in a lull of the posturing about a decade ago, it was barred from being lit. How could that be anything but psychological warfare or propaganda?
That doesn't make it bad, either. It's part of a propaganda war which is continually exacerbated by the North. They don't have much to bring to the negotiating table, so they create it with these kinds of complaints, which are numerous and ridiculous, hoping to bargain it away for the crops they've stolen from their people and destroyed through terrible central management. Sometimes it's pretty meaningless, sometimes it involves the sinking of a ROK ship or shelling of a Southern island. Sometimes they have to complain about nothing just so that they don't lose face and look like they are too scared to complain. Often enough they can't even accept a good deal because they've painted themselves into a corner and always need to demand more or need to appear to be stronger or in better shape than they already appear.