Please tell me that you didn't get the Smart 2.0 refresh a few weeks ago. Or that you have a 2009.
With the new software, when you hit a shifting paddle (on purpose or accidentally) it switches you to manual mode. The engine will later downshift as necessary to keep your revs from going too low, leaving you in 1st gear at a stoplight. To return to automatic mode just hold the right paddle for more than a second and you'll see the "D" indicator pop up in your instrument panel display instead of the "1" that's causing you grief. If you see numbers instead of "D" in automatic mode, it's an indication that the paddle has been touched.
If you accidentally hit a paddle, you'll be switched to manual mode. You just have to get back to auto by holding the right paddle or "jiggling the shifter."
If you have a 2009 or Smart 2.0 refresh for your 2008 without the paddle shifters it could be a bad unused switch input giving false information. It's also possible the switch on the shifter indicating manual or auto (or the electronics it interfaces with) is bad.
Your dealer should be more effective at handling the issue assuming it isn't the "feature" I described above (which I very much enjoy). If you have another dealer available, you might consider getting an appointment for service with them even if it is a bit more of a drive.
The Smart car isn't what's the problem in your case for anything except the firm ride. It's the Smart car that you have that's the problem.