Hi, if she had asked outright if smoking is healthy or unhealthy/good or bad for you, you'd of been able to reply the way you'd wanted to, guiding the conversation is a great where she didn't ask, as challenging it directly could cause conflict, between you and the child - the child within themself..
as, what would of been a positive role play experience is questioned by a respected adult, affecting self esteem/confidence. Not challenging it directly helps to support the child's resiliance in that when they have the information that contrasts with their current understanding it opens up an opportunity for them to use the information in an unbiased way on another occasion, informing their future play - child to parent when they discuss the day's happenings and then potentially parent towards you.
Looking at the negative impacts of smoking is good to explore as a group through awareness activities, literature/signage and possibly as a courtesy to smoker/non smoker parents through direct communications with them - asking if there are or would be any concerns with the setting planning anti-smoking activities ..
Explain that you may cover learning that involves ..
How smoke poisons the body
Makes you cough
Hurts lungs that help you breath
Has a smell people dislike
Costs a lot of money
Is not allowed in some places and buildings
This prevents discrimination, prejudice, unprofessional judgements & decision making being made against what is an adult's right to smoke, other's right to protection and children's right to express their play freely.
Campaign & charity websites have some good resources:
www.nosmokingday.org.uk
Love your lungs campaign and
effects of smoking from the lung foundation
Activities also enable safeguarding, assisting children to consider protecting themselves by saying no or moving away should they be offered a cigarette/be around smoke/role play actions knowing how it harms them.
There's much in what you witnessed & did, written as a reflective account that would support study needs

xx