I would note that the lighting of the cigarette occured in the period when the PIC should have been deleting the HOLD previously entered in the FMC, since he had by then been cleared for the approach.
And accidentally entering the hold and turning away from the inbound course initiated the "circus" that just got worse and worse thereafter.
But it was a brief minor distraction during the 3 minutes or more the crew failed to correct that error - so yes, a symptom of complacency and loss of SA and focus even then, rather than a cause.