I don't see any suggestion that ships laid smoke deliberately, but engines at high power plus chaff and weapons firing might well look like a smoke screen to an excited observer.
It seems pretty well established that the Escuadron I Skyhawks attacked HMS Avenger, which was off to the south of the carriers that day on a special forces insertion mission and would likely have been the first ship encountered on their track north of Stanley. It may seem improbable that the Argentine pilots could confuse a 3,000-ton frigate for a 20,000-ton carrier, but consider that these were Air Force pilots without much experience against ships. It would not be that hard in the stress of the moment to misread the smaller ship's superstructure and helo deck for Invincible's long island and relatively short flight deck aft of the island. The situation was extremely hectic what with Sea Darts from HSM Exeter flying through their formation, likely killing one of them and possibly a second; assorted AA going off, including 114-mm rounds from Avenger; chaff clouds from Avenger as an anti-Exocet measure; etc.
There is a quite thorough analysis of the British evidence (on an Argentine website, no less). I think it makes a very strong case for the British narrative -- many witnesses, who apply a sensible level of skepticism to their own claims. For example, in the moment, Avenger claimed one Skyhawk or Exocet kill with the main gun, but on review, the ship's officers admit this is unlikely, and that the explosion seen was almost certainly Exeter's Sea Dart at work.
[URL unfurl="true"]https://www.histarmar.com.ar/Malvinas/Sciaroni/attackMay301982-Britishview.htm[/URL]
