You don't even need to have smoke.
Whenever someone suggests something and then says that it's in something else, everyone rages at them.
By saying that another fantasy thing used it is showing an example of how it can be relevant. I don't want DF to be a LOTR clone as much as anyone else does, but just because it's in something else doesn't mean we can't have it.
The same goes for period correctness. Just because they didn't have it in the medieval times doesn't mean we can't have it. The best example of this is coking, coking wasn't invented until the 18th century I believe. DF isn't a simulation of medieval Europe either, so just because it was used around then, but not in Europe doesn't mean that we can't have it.
In fact, diversity is something we need, especially with the caravan arc. Right now, players strive to find the perfect embark, that contains iron ore, flux, coal, clay and sand. Players will need to import things when the caravan arc is complete. Tobacco and other drugs like guarana and coffee. Some things will only grow in certain climates. This would be especially well done if Improved Farming was implemented.
I am personally in favour of having tobacco in fortresses. I'm not too sure about health effects, like cancer and stuff. It beyond any doubt that it does happen in real life, but it could be a bit of an annoyance in your fortress. A way of implementing tobacco is that they could get a good thought from chewing/smoking tobacco, and there is a small chance of getting addicted. When addicted, they would get a negative thought from not having tobacco to smoke. After a while without smoking, addicted dwarves can lose their addiction.
You could then have a smoke free fortress, so you don't get any of the benefits of smoking (bad wording I know) and you don't get any of the disadvantages of smoking either.
Dwarves would just smoke as they work, instead of having smoko breaks.
I don't think that smoking should set the booze stockpile on fire though, as it's not actually that flammable in real life, especially as a lot of it is only ale.