I don't know Smithfield very well - only to walk / drive through. My impression is that it's very built up and has little or no green space. Islandbridge on the other hand is less built up and as has been previously pointed out is right beside the Phoenix Park. IMO neither area is rough.
I know Islandbridge quite well, as I pass live nearby and run round there alot. As previous posters say, there are no shops / bars or restaurants there. Smithfield obviously has lots of these.
However, Islandbridge is right beside the river and the Phoenix Park and has great transport links to the city centre.
Which you choose will really depend on how near you want to be to town. If thats important go for Smithfield. If access to open spaces is a factor, you should look at Islandbridge.
Personally, I'd go for Islandbridge.