Eager to put a reality check on the thaw in relations, Pence will meet Friday morning with North Korean defectors and pay respects at the Cheonan Memorial in Seoul, which honours the 46 South Korean sailors killed in a 2010 torpedo attack attributed to the North.
The North's conciliatory moves related to the Olympics have generally been welcomed in the South.
Although the United States had not requested talks with North Korea, Mr Pence left open the possibility of some contact.
Pence will head the USA government delegation visiting the Olympics' opening ceremony at Pyeongchang, South Korea. North Korea is sending 22 athletes to the Olympics, as well as hundreds of cheerleaders, musicians, singers and dancers. Although North Korea said its delegates had no willingness to meet Pence, the vice president again did not rule out the possibility of a meeting on the sidelines of the games.
South Korea's United Nations mission told the Security Council committee the delegation was expected to attend the opening ceremonies on Friday and stay until Sunday.
In North Korea's dynastic system, which upholds the Kim family's "bloodline" as a sacred leadership qualification, Kim Yo Jong wields a singular clout that can not be matched by any non-relative members of the elite, according to North Korea analysts.
Moon has supported USA -led sanctions against the North, but he has repeatedly called for dialogue.
Pence met with President Moon Jae-in to advocate a clear-eyed approach toward his bellicose, nuclear-armed neighbor, warning against North Korean "propaganda" around the games.
Sources told CNN correspondent Will Ripley that, although the proposal was not certain, Moon's potential trip to the North could happen on August 15, South Korea's Liberation Day.
The exemption will also be extended to all members of the delegation, meaning that a ban on luxury goods to North Korea will be temporarily lifted - a measure that would allow for gifts, for instance.
"As we speak, an estimated 100,000 North Korean citizens labor in modern-day gulags", Pence said. North Korea held a massive military parade highlighted by intercontinental ballistic missiles.
North Korean leader Kim reviewed the display of military might, the first to take place since April past year, from a balcony above the plaza.
5 of 9 Hwasong-12 and Hwasong-14 missiles are displayed during a military parade held in Pyongyang, North Korea, on February 8, 2018.
Other military parades in recent years were broadcast live, but the event on Thursday aired several hours later.