OK. I will add my opinions which are both supportive and controversial. First off, I totally agree with Kostas and Eric. ALL newcomers to lifting should squat with a barbell, free-weight style. They should NEVER use any other device or technique for squatting. It is important to develop proper form, balance, and build the corresponding stabilizing muscles involved when doing squats. One should not consider other mechanisms for squatting until they have at least 3 years of solid consistent lifting under their belt. This is the supportive statement :-)
Now for the controversial statement :-) The Smith Machine is not the Devil's child nor an abomination. This machine has caused more controversy pro and con than anything else outside of anabolic steroids. I agree that a Smith Machine should not be used by novice or beginner trainers. I view it as a device for more advanced lifters. It is also not a good device for powerlifting and those whose sole goal is power and strength. For those interested in bodybuilding and/or physique development, the Smith Machine is a useful piece of equipment when used PROPERLY. The issue is most people don't know how to use it correctly.
I have been using the Smith Machine to do squats and shoulder presses for about 20 years now. The first 10 years of lifting, I didn't use it at all. Since I train alone, these 2 exercises I feel more comfortable doing in the Smith Machine. I have no shoulder, back, knee, or hip problems (knock on wood) from using it. When I do squats, I go ATG and my foot placement is exactly as it would be doing free bar squats. Many people place their feet too far out or too far in thus causing the joint issues most people hear about. I can transition to free bar squats I just need to adjust my balance as the bar is no longer stationary but it is not impossible to do. The bottom line is my leg workouts are intense. My quads are always sore and my leg development and strength are above average for my size and age - I am no Arnold nor a IFBB pro but I feel my leg routine some would find quite challenging.
The bottom line is I am not writing this to debate physics, kinesiology, or biology. I just want people to understand that the Smith Machine has a purpose and when used correctly and with the right level of lifting experience is a very useful and productive piece of equipment.
John