Hard to believe, but Theon's plan seems to be working so far. Ser Rodrick has gone off to the rescue of Torrhen's Square and Theon has been able to take over Winterfell with a handful of thugs. He's forced Bran to yield, but the smallfolk can see through it. The blacksmith, Mikken, refuses to yield and gets a spear through the neck for his trouble. Even poor Hodor gets a beating. Theon is going for the Joffrey style of rule, and I can't see it working out any better for him. Theon wasn't there at the end of AGoT when all the lords were getting excited about Robb being the King in the North. I'm sure they'll help him re-take Winterfell at their earliest convenience.
Osha has joined with Theon. Either she's up to something clever, I'm about to get payoff for thinking the Starks are mad for keeping her around in the first place.