Absolutely false. A friend of ours had a slow-speed, corner-to-corner head-on collision in her Smart (hard to say, but someone turned left directly in front of her and they collided driver-side to driver-side.)
They call it a "Smart" car for a reason. Her car decided that the speed was slow enough that retracting the seatbelts was sufficient, and that deploying the airbags was not necessary - airbags can really mess you up. Between the cage and seatbelts she was absolutely fine.
Her Smart car was repaired. She literally stepped out of the car and "walked away". The big pickup that hit her was totalled, and the emergency crews had to pull the driver out, and take him to the hospital. They didn't have to use the jaws or life or anything dramatic like that, but he was banged up.
The idea of a Smart Car is that the Smart's steel safety cage uses the big vehicles crumple zones, so they big car ends up crumpled and mangled.
We have two Smarts. Love them, and wouldn't give them up.
They can carry more than you'd think. Hockey sticks, with driver plus passenger. Enough luggage (if you pack light-ish) for long driving trips. I've carried an 8ft Christmas tree home in one (no passenger, and the tree sticks out the back).
If you every need to carry 2 passengers you're hooped. Haven't tried a passenger and dog yet. They are very easy to park... really easy. In my part of the world they are putting in special "micro" car parking spots which are either cheaper or more convenient (or both). Love parking right outside the busy store, next to the handicapped spots.
No matter how busy the house-party, I can always find a spot to tuck the Smart, right near the front door. In fact, in any parking situation where there are those "grey" parking spots.... the Smart will fit. And those cutouts they put into sidewalk curbs for wheelchairs? You can use 'em in a Smart Car.... don't ask me how I know, but knowing that fact may help you out one day.
If you anticipate daily highway driving you may want something with a bit more weight. They only thing we don't like is that on a highway on a very windy day you do have to 'fight' a bit. There isn't enough weight to a Smart to give you much momentum. On calm days the Smart is fine on a highway, we did a record run down from Campbell River a few months ago, averaging 120kmh no problems. We've run up the I-5 in heavy traffic with no worries as well.
On city and country roads however, they are a treat. What they don't tell you is that the Smart is not a bad sports car. They are light and the engine is in the rear. The electronic traction control is pretty good, so you can really push the corners. Don't expect to get the stated fuel economies if you decide to drive like Paul Tracey though

.
Take one out on a test drive, best way to see if you like it.