In my opinion delay is always bad on mice, both buttons and sensor. Only reason for players to prefer mice with delay is because of being used to something and having developed a muscle memory to create a synchronization between muscle movements and eye for specific values in delay..
Smoothing is something that can be controversial when done with small enough delay. Some people may have difficulties to create smooth movements with their hand therefore smoothing could be a way for them to have a decent in-game movements with flawed in real life control.
Reason to prefer less smoothing is to have more accurate control over the cursor while having accurate movements in real life.. Usually made possible with low enough mouse sensitivity.
Being used to something plays a huge part at the smoothing controversy as well..