Well, I think Smith is a virus, he cannot manifest himself outside of the Matrix (i.e. at a Xion level) unless Xion is ALSO part of the Matrix, a program cannot exist as a solid object as such, as for what happens when he takes over other people, I don't know, maybe they will wake, but with Smith's persona?
I suppose it's possible that Xion is part of the Matrix, but that is so old hat I doubt it.
As for robots, got to disagree with you there, considering the removal of the 'Bug' in Matrix 1, and the Bullet in 2, I thnik these are flesh and blood people.
I think this all revolves around Love, it wouldn't be out of place in a Chinese directed movie, and I think the thing that makes Neo different from the other 'Ones' is his love for Trinity, that is why he didn't die, and, more notably, that is why Trinity didn't die either. But Neo's non-death made agent smith into a Virus that the Matrix cannot cope with, and the only person who can stop him is Neo. As for stopping the Sentinels, although they are not 'within' the Matrix, they are still controlled by it, and Neo has a limited control over the Matrix, which is growing.
That's my view

Edit : Oh yes, though I didn't enjoy Reloaded as much as Matrix, I remember Empire Strikes Back, so I will wait and see
