* S.Korea plans joint training visit to North's Masik Pass resort
* Masik Pass part of major tourism resort developed by North's Kim
* Tourism rare remaining source of funds for sanctions-hit North
* For multimedia coverage on North Korea www.reuters.com/north-korea/
By Hyonhee Shin
SEOUL, Jan 22 (Reuters) - South Korea's offer to send athletes to a North Korean ski resort for joint training ahead of next month's Olympics risks giving leader Kim Jong Un's regime legitimacy and some much needed cash, North Korean defectors and experts say.
Already facing criticism for plans to march under a unity flag and field a combined Korean ice hockey team, the administration of South Korean President Moon Jae-in may come under further pressure if it is seen to be endorsing Kim's luxury getaway on North Korea's east coast.
"The idea of joint training could be used as a propaganda tool to rationalise how far-sighted Kim Jong Un was in making what was actually an anachronistic decision to build the ski resort at a time when ordinary citizens are starving to death", said Kim Sung-han, a former South Korean vice foreign minister.
North Korea's participation in the Olympics was a goal for Moon, who hopes to use the event to defuse tensions and break a months-long standoff over the North's nuclear and missile tests.
The two Koreas agreed during rare talks last week to hold joint training sessions at the North's Masik Pass resort ahead of the Games in Pyeongchang, South Korea.
Seoul officials are scheduled this week to inspect the resort's facilities and the newly built Kalma Airport nearby that may be used to fly in the South Korean skiers, who are not expected to attend the Games.
Launched by Kim in late 2013, Masik Pass is near the seaside city of Wonsan, where the third generation leader is developing a luxury resort including hotels, an aquarium and a golf course.
Wonsan and Kalma Airport are also important defence areas, used for large scale artillery drills and as the launch site for dozens of missile tests in recent years. (here)
Masik Pass was meant to rake in hard currency from not only foreign tourists but also a growing number of North Koreans who have built wealth from an increasingly market-based economy.
Kim visited the construction site on multiple occasions, taking test rides and chastening workers to speed up construction, which gave birth to a new propaganda slogan, "Masikryong Speed".
State media extolled the resort as a gift from the people-loving leader to raise the standard of living.
But the resort has been criticised by former South Korean officials as an emblem of the Swiss-educated leader diverting scarce resources to satisfy his own lavish lifestyle while average North Koreans suffer.
North Korea's state-run KCNA news agency on Sunday criticised some South Korean politicians and media who have questioned Pyongyang's motives regarding the Olympics detente.
"There is no doubt about the sincerity and authenticity of (North Korea) to improve the North-South relations and to ensure successful Olympics," KCNA said.
Kang Eung Chan, a defector who had lived in Wonsan, said he took a three-day trip to the ski resort in 2013.
At around $100 per day including food and ski rentals, the holiday was far too expensive for most North Koreans to enjoy - even to a successful businessman like Kang, who ran a quasi-private clothing factory for Chinese clients.
"We paid everything in U.S. dollars. It is not that cheap by North Koreans' standard," Kang told Reuters.
North Korea does not release any official statistics, but experts estimate the country's average monthly salary at around $30-$40.
Tourism is one of the North's last remaining sources of foreign currency yet to be hit by United Nations Security Council sanctions.
Experts point to possible issues around sanctions if South Korea ends up paying any fees to use the resort or providing costly new equipment to facilitate the ski training.
South Korea's Unification Ministry said no decision has been made on the visit yet.
"We're aware that there is some view that we may dilute sanctions by offering financial support to the North Korean delegation", ministry spokeswoman Lee Eugene told a news briefing on Friday.
"Our position remains unchanged that we will continue global cooperation on sanctions and pressure ... and we will make sure there will be no problem by consulting closely with the international community and the U.N. expert panel".
A United Nations panel monitoring sanctions on North Korea said in a report last year it had included ski lift equipment in its regulations after cable-car systems produced by an Austrian firm were spotted at Masik Pass.
James Kim, a research fellow at the Asan Institute for Policy Studies in Seoul, said South Korea would need a "very well-thought-out plan" to address the sanctions concerns.
"The Moon administration's goal here is to reduce tension and use the Winter Games as a springboard for a peaceful resolution to the North Korean nuclear issue", he said.
"But I think the critics are right to point out that we may want to think about the means by which Seoul wishes to achieve this objective."
UK embassy officials in Pyongyang who visited the site said last year children had been mobilized to remove snow and polish up the resort, calling the practice "deeply concerning".
"It's well known that forced labor is regularly used on both large and small infrastructure projects in North Korea, and this includes required labor by students, meaning that child labor is used as well", said Phil Robertson, deputy Asia director at Human Rights Watch.
"There is no reason that the Masik ski resort would be any different from this established model".
With the two Koreas planning a host of Olympic-related functions including a joint cultural event in the North's Mount Kumkang resort, concerts in both countries and a Taekwondo demonstration in the South, there was a risk the events may overshadow the Games, said the former diplomat Kim.
"The Olympics per se is a non-political sport event, but if other auxiliary events get too large, the Games' pure identity could be tarnished and politicized", said Kim, who now teaches at Korea University in Seoul.
"I just hope we step back for a moment and take it easy." (Reporting by Hyonhee Shin; Additional reporting by Josh Smith and Ju-min Park; Editing by Lincoln Feast)