Alex Smith is a fine quarterback. SF screwed the pooch when they went with Kapernick. That said, SF got excellent value for Smith. 2 second round picks is a high price for any QB.
Smith has the heart of a lion, the moves of a leopard and he doesn't come with any "character issues".
That said, Smith hasn't yet showed he is a top 5 type of quarterback. He should get a 3-5 year extension for big money but with a comparatively small guarantee that is loaded with incentives. He still needs to prove that he deserves top 5 type of money. He has shown flashes of brilliance but he hasn't yet proved that he can do that all season long and year after year.
He may be the second best quarterback our Chiefs have ever had....or he may simply be a very good quarterback. The money he gets paid should be based on performance.