I agree with Big Nate, he said everything I would have said, but worded it perfectly, so I'll leave it at this. The Smith Machine has no place for squatting. A lot of trainers throw a beginner on them to "learn" how to squat, and in reality, all they are learning is how t owreck their knees. The thinking that free weight squats are dangerous is retarded, when done right(something 98% of people don't do), squats are perfectly safe.
If you think about it, serious powerlifters, olympic lifters, and strength athletes with excellent form are rarely injured from weight training,and they are using free weights with heavy weight for low reps, however most people who cry that bench presses recked their shoulders or squats hurt their knees or they blew their back out deadlifting are the average gym rat using a fraction of the weight an elite or world class athlete would on a heavy day. The gym rat uses poor, sloppy form and has no idea how to set up a training program.
Well, my rant is over, and I apologize to the guy who started the post, and to answer his question, In my humble opinion, I feel that a Smith Machine SHOULD NEVER EVER be used for squatting purposes.