They have already nerfed Smoke's damage twice since release. I feel like taking out the OTG smoke bomb will gimp him horribly. Smoke is a character that needs to do damage in large chunks to win. He doesn't have a very good rushdown game or even a solid anti-air. His uppercut is horribly slow. His sweep is good, but he has no low combo starters. He is also not at all intimidating from a long distance, seeing as his smoke bomb doesn't chip.
What makes this character good right now is his ability to really capitalize his damage on almost any hit. Take that away and what does he have?