Think you should check the hose routing. I have D series blower and same catch can as well. You will likely smell a small amount of oil - but this is due to the can venting out and only happens for me when going into boost. The smoking is completely not normal.
Check this post out as it explains how the outlet from the can should be set up.
https://www.camaro6.com/forums/showthread.php?t=545270
The line from the oil fill cap should run to the catch can inlet.
There is a bit of overly complex stuff going on with the t-fitting - not sure what they were doing.