We have a Weber kettle grill that's about 15 years old and is still in excellent shape. We use it to cook smoked foods by the indirect method -- coals on one side and the food on the other. How close the meat is to the heat depends on the size of the cut we're making.
Generally, it's at least 3 to 4 inches away horizontally (Not meaning the direction above the coals (higher or lower); instead the direction away from the coals to the left or right).
We've barbecued a lot of foods on our Weber over the years and have used smoking chips to add flavor to the meats. Yet, we don't get a the smoke flavor you get from a "real smoker", the kind mentioned above, where the food is cooked slowly with smoke a water to keep moist.
That said, we've made some meals with smoke on our Weber, including a nice pork butt with a delicious flavor including
Pork Butt Sandwiches we featured in our cooking blog last year.
So while the Weber kettle isn't a true smoker, you can make some nice smoked meals with it.
Matt