[Ghostt]

Not for nothing, but you didn't fix it, you at the very least found the cause, now you can fix it.

I'm confused, was it the float needle valve(bottom) or the diaphragm slide(top)?

As far as smoke goes, it's hard to say, if your float valves get stuck open, then you can get gas in your oil. Check your oil level , has it increased? Decreased?