Though it has yet to be confirmed, some foreign diplomats in North Korea have reported seeing wall displays that include Kim Il Sung's portrait, but lack that of his son, Kim Jong Il. Here's the article from Yahoo. So, does this really mean anything? Well, the article says that
It was unclear what might motivate their removal, but the South Korean official said his country's analysts did not have indications that Kim was facing significant internal political challenges.If you read later on in the article, another diplomat reports nothing strange going on and he'd recently seen "many Kim portraits during a visit to a hospital on Tuesday."
It truly looks like the media is reading into this way to much here. The perceived absence of Kim Jong Il portraits really might not be that significant (maybe they were removed for cleaning!)