That's interesting stuff, i'll have to read up on that. In any case, I've personally never used a smith machine (the gym I go to doesn't have one, only a squat rack). Perhaps we're generalising too much here, but machines do help with SOME movements like the shoulder press and chest press form. And there's some machines that I feel are indespensable simply because I can't do them using free weights (lat pulldowns, tricep pressdowns, cable standing flyes, leg press etc.)

And I would concede to your points about free weights vs machines, save for the fact that it is on the assumption that the newbies in question actually have someone experienced on hand to spot and guide them with the free weights in the gym.

The articles here all say pretty much the same thing: Free weights should be the basis of one's training regimen, and are machines to supplement free weights.
The pros of using machines is that it doesn't really require supervision/spotters, and you don't have to fear having your face bashed in by a dumbell or ribcage cracked from a barbell.

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As most of you probably notice (and practice), gym regulars don't really bother to give coaching to "them unwashed newbs" stumbling around the gym with no idea of how to train.