There are quite a few people in my "crew" that recently moved here from Thailand and they talk about these protests quite a lot.  I would say that the royal procession really looks like a false flag operation and was an excuse to deny additional protesting.  If you know one thing about Thai people and their recent past it is that these sort of decrees only encourage people to get out there in greater numbers. 

The government has a really tough situation on their hands.  If they crack down they will only look like the bad guys, but if they give in to the demands they kind of undermine their democracy.  It's a tough call, that's for sure.