its does take both sm and cf1 or 2.. as for whats better smartmedia is being discontinued.. things will get smaller basically for most cameras..
i think the smartmedia are better from a speed point of view for the s602 or at least they are faster than anything other than the fastest of the compactflash cards.. i must admit to being surprised to read this but it does seem the case.. the s602 needs a fast card.. thow there is the size thing.. a microdive might be the best option for video of any length..