Not even looking at the smoking part, showing up to an interview with any kind of nasty odor is generally bad.
Also, long living smokers and Japan are called exceptions to the rule. This is why we use meaningful statistics like averages and medians, not single cases. It doesn't help that 85% of lung cancer patients are smokers.
Anyways, few people are going to have sympathy for something that is 100% voluntary and done to yourself. Alcoholics, druggies, sex-addicts, or really any addict doesn't exactly have it easy in the job market either. People with tattoos and piercings still have trouble, even if those things cost the company no money in any way.
Anyways, is it right? No. Someone's personal life choice isn't going to seriously affect profit unless that person is in a position to put out nation-wide negative-publicity with their social stigma. But how many jobs are actually like that?
Should these practices be illegal? Not really. Culture and society will just need to get to a point of acceptance, or the people that do things to themselves need to rethink what they do before they do it.
I think showing up to the interview smelly is more reason to not hire someone. Personal hygiene is a basic human thing.