North-South routing = upstream router of DLR to DLR which normally NSX Edge VM.
Do you have NSX Edge as the upstream router of the DLR?
Do you use HA or ECMP?
As per design guide, for ECMP the recommendation is to tune the hello/dead timers to 1/3 seconds
and 30/120 seconds for Edge HA
To handle North-South traffic outage, you can create summary static routes on the upstream routers (NSX edge) summarising all the network behind DLR.
The same static route can also be used to send a summary route to physical router.
With this static routes, failure of DLR Active Control VM results no outage of North-South traffic.
South-North traffic should still be forwarded based on the routing/forwarding tables in the ESXi regardless of DLR Control VM availability
All of the screenshots above are taken from the design guide VMware® NSX for vSphere Network Virtualization Design Guide ver 3.0
Regardles off routing timers settings, the North-South traffic will still be impacted due to flap in the dynamic routing adjacency.
Here's how the show ip route looks like when the Active DLR Control VM is still online
And here's how the show ip route when the Active DLR Control VM is failed
and here's how it looks like when you have DLR Control VM failure with static route
You can also take a look at VMworld 2016 session NET8131R - NSX for vSphere Logical Routing Deep Dive
slide: NSX for vSphere Logical Routing Deep Dive
