@Melissa2741
Smoking is very difficult to "prove", unless there are burns or ashes or other leftovers - and even then, it's up to Airbnb outsourced support to make that judgement, which usually doesn't go in favour of the host. "Smell" is all but impossible to prove. If you have photos of the guest smoking in the house, then this is a clear "invasion of privacy", and subject to severe penalties, including delisting.
It's unfortunate that some guests choose to disobey these important "house rules", but occasionally they do. We've had the very same problem in the past. It's expensive to fix, but in any practical sense, there's precious little you can do about it.
Confronting the guest or reporting it to Airbnb - and particularly a demand for compensation - will likely result in a retaliatory review, complete with imaginary atrocities you never committed against the guest - in some cases, they may demand a refund for these fabricated atrocities. The same character of guest who would choose to ignore this important rule are precisely the same character that would write a retaliatory review or even demand a refund, which historically on Airbnb, they're likely to receive.
So, your practical choices are A) confront them and suffer any consequences, or B) chalk it up to experience, and become better at attracting better guests, and screening guests prior to booking.
Good luck and happy hosting.