Right, but Smeargle's not going down without a fight either. A combination of Focus Sash, Spore, Protect and Ingrain can guarantee at least a few turns of stalling as well as block most attempts to phaze it out (Protect -> Spore -> Ingrain -> Protect, or Protect -> Ingrain -> Protect -> Spore -> Protect, depending on the Pokémon your opponent has out). If you're lucky and nab a boost to speed or evasion, you could Spore your opponent's counter before they even have a chance to status or attack, at which point it's a cinch to Baton Pass to something like Garchomp or Thundurus, set up a Substitute and sweep unheeded.
On the other hand, when it falls, Smeargle falls hard. Speedy Pokémon or ones with Prankster like Whimsicott will give Smeargle hell while setting up (especially with Encore) and Unaware Quagsire doesn't give two shits about Smeargle's boosts and can just haze away (and might honestly be the #1 anti-Moody Pokémon, now that I think about it). How well you can take advantage of the boosts really depends on the kind you get as well.
On the other, other hand, when Smeargle does get a pass off, things will die. Rolling dice with Moody can get pretty nerve-wracking.
Ah well, Smogon bans are widely accepted, so you're right in that this is all academic anyway. Random WiFi isn't really worth it for the load of bullshit either, if prior experience and word of mouth are any indication.