I agree, while there might be a reason in the old days with the muscle cars with tiny drum brakes, today's car have such good brakes that there is no reason to use engine braking unless you are going down a long steep hill. As you have stated, brake jobs are far cheaper than an engine rebuild.
In racing, there are legit reasons to downshift prior to entering a turn, but it is not to save the brake pad, but to put the car in the right gear to power out of the turn. In the case of the smart, there is really little reason to do that with a 70HP engine.