I think it's important to know what we're comparing....actually giving a baby a fag (like Wayne and Waynetta Slob do to Baby Frogmella in Harry Enfield!!) would of course be horribly poisonous...and toddlers have died, eating a cigarette. So in that sense, formula milk would not present anything like the same risk to the baby.
But a baby taking in nicotine via the breastmilk (or as second-hand smoke, from the mother's breath) is not the same thing. The studies show that the potential impact on health may be real, but not as great as the potential impact on health of getting formula instead of breastmilk.
This is not to say that formula milk is a poison, or that babies can't be nourished on formula milk, or that any individual baby has measurable effects of having formula.
Breastmilk, in fact, does not have 'benefits' - it's just the normal, physiological way to feed babies. It has 'benefits' only in the same way as breathing has 'benefits' over being on a ventilator, or walking has 'benefits' over being in a wheelchair, or urinating has 'benefits' over being on dialysis. This is not to equate formula feeding with any of these things, BTW, but to emphasise that one thing is physiological and the other isn't, and to underline the limitations of thinking that bf gives 'benefits'.
Studies indicate that the 'benefits' of feeding physiologically may be affected by smoking, but not erased, and that babies of smoking, bf mothers still 'benefit' from the other 'advantages' of being breastfed.
It's still not a 'good' thing to bf and smoke though.
Making no value judgements on anyone for formula feeding or not, or smoking or not....believe me