I discipline without doing things that "sound awful but" and without taking things away. (more on that below) Smiling can be a nervous reaction (how many times can you remember an adult saying something not so nice and then laughing slightly afterwards?) I also find that reasoning, when done with problem-solving as the goal, IS effective.
Sounds to me that your son fits the "spirited" category who are often advanced & confident. A great place to start is "Raising your Spirited Child" by Kurcinka, available at many libraries and also in audio form.
What helped me was to take a minute to find out where he is coming from. Once I discovered my son's objection, it very often was easy to meet that AND still enforce what I wanted to have happen. I also learned to "set things up" so that they are inviting. "Playful Parenting" by Cohen is a great book to teach this. It doesn't take any more time and my kids don't fight me. Once you get the hang of it, it becomes second nature.
As far as hitting, a toddler or preschooler doesn't really get that hitting hurts the other person. His brain doesn't empathize and understand that. It's not right to do, but happens with many kids this age. My advice is to act "for" him as much as possible. Watch him like a hawk and intervene when he's about to hit. Keep hard objects away when he's playing with others. And when he does hit, speak for him and apologize, set things right & then move him away. <g>
You are not a pushover as long as you are preventing him from doing something. You can prevent calmly & kindly just as effectively as yelling or punishing. Either way is keeping him from doing it. The former is helping you stay close to your child, the latter isn't. Likewise, you are not a pushover as long as you follow through and your child does something. You can get him to do something by helping it to be fun, by solving his objections (if they are minor) and by not doing anything until what you want to happen does happen. Again, you don't need to yell or punish to do this.
I've been raising my extremely headstrong (and intelligent) son this way for six years and absolutely treasure the close-knit bond we have because I enforce discipline without being the "bad guy" and taking things away or punishing him other ways.