I've used smarty (version 3 RC) for a recent project and I have to say I'm very pleased with it. Short tags are bad. They are going to be deprecated in PHP6, and they senselessly take away a little of your application's compatibility across all servers.

I don't understand all the hate against Smarty. How would the "PHP is already a templating language" argument explain the rise of all these PHP frameworks we have no, almost all of which contain some means of templating.

Smarty allows me to not have to worry about boring presentation layer crap (ie htmlentities) without having to commit to a large framework. Plus its syntax is pretty nice.