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Fatts,
you seem to have missed out the "million" from the Bangkok Post report (or at least the on-line version)!
While 223 million US$ makes up 20% of the Cambodian overall government expenditure, it is still a long way from the 4.5 billion US$ approved for this year by the Council for National Security (CNS) last year under the military government - a 24% increase (and usually 30% of the Thai government's overall expenditure).
.... it is not as daft as it seems, I have no idea as to the military power of both countries, because let's face it generally when there is a war in these situations, it's military that have to fights it and not Joe Bloggs off the street - unless of course the situation deteriorates to a stage where they call up each and every one - which is highly unlikely in this situation.
Now the point I'm making, one can hardly say that Thailand is stable at the moment can they, from a policitical point of view, and probably from other "views" also. The very thought that Cambodia even mentioned the word "war" means they obviously have "strategies" in place in the event there is one - I wonder if Thailand has or were they thinking along the same lines though! Interesting thought on who is actually prepared.
I have no way of substantiating this, so it's pure hearsay - gossip if you like. While I was in Cambodia I was told by a Cambodian that many people there believe that the size of their army is grossly overstated. Many of their soldiers exist only on paper, and the salaries of the "ghosts" slip quietly into the pockets of the generals and their cronies.
Your friend was correct, at least in as much as although many of the soldiers do exist their salaries are minimal and many are re-employed as security staff, for example around Siam Reap - often by security companies run by the Generals you refer to!
When negotiating one inter-faction prisoner exchange in Cambodia several years ago I realised very quickly that the Khmer Rouge "Colonel" involved had never actually commanded more than 6 men: his second-in-command, a "major" was also his bodyguard, even though he had lost an arm* when he forgot to disarm a mine before moving it, and the remaining 5 were the only men in the small hamlet where they were all subsistence farmers. When I pointed out that in most armies he would be lucky to be a Corporal he laughed and said that would not impress his wife so much!
In Thailand the reality is similarly unimpressive, as despite having a similar sized Army to Britain, Thailand has more Generals than the British Army has Colonels. It is also relatively common practice for any Thai conscript who has completed his basic training (which is unavoidable once conscripted) but who does not wish to do any more military service to "sign over" his pay to his superiors and to only have to return to his unit at the end of his service to be formally discharged.
* : no jokes about "maybe he was an expert in unarmed combat" please!