I fail to see the "direct election" in this process. It seems like a committee that theoretically takes into consideration debate and opinion but which then makes a unilateral nomination, who runs unopposed. Am I missing something?

By direct election, what's meant is that all levels of government, from the local, to national level, are elected directly by the people.

Contrast this with it's neighbor China, where local level positions are directly elected, but by the time you get to the national level, positions are elected, indirectly, by the directly elected representatives from the lower levels. The DPRK doesn't have that same sort of insulation at the national level.

Candidates, meanwhile, are decided through mass meetings. This is a very loose comparison, but imagine something roughly akin to the caucus system in some USAmerican primary elections. But instead of boiling it down to two candidates, it gets boiled down to one. The final vote where you cast your ballot is essentially a ratification vote of that 'primary' process, where you vote "yes" or "no", but that doesn't mean the process which preceded it wasn't competitive.