the smith machine has it's uses. I love using it for plyo-bench (when I want to do some heavier ballistic pushes then I could get from a push-up)and while I wouldn't uses it for squats, there are some great powerlifting moves to help increase your bench or punching power that work VERY well.
But relying on the machines instead of using them to supplement your training is a classic newbie problem.
Very true. We use it occasionally for clap pushups, that is, with your feet on a fitball, and your hands on the bar. It's pretty scary, and unstable as hell