The problem is that you still would need a LB. Sure, he's struggled but paying eating up $9.4 million of cap space for him NOT to play for you seems a bit foolish. I think it would make more sense to maybe keep him around one more year under a new DC, if he sucks again, then cut him. I'd also not worry about him or LVE when it comes to the draft - LB should be considered one of many needs we have heading into the 2021 draft.
At this point, I am indifferent on what they do with him, but from a financial perspective, in a year where our cap is gonna be tight, I am not sure it makes sense to eat up that much cap space and then have to go out and find another LB in FA or the draft, and essentially them over $10 million in cap space (Smiths dead money hit + whatever you pay a new LB to replace him).