I agree with you, they should reduce the blindness effects of the smoke though.
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But it's smoke? That's honestly what it's meant for.
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Then remove the agility debuff. Hit them with smoke to slow them and then bam wombo combo that grenade. It is fine where it is bc nightstalker grenades are terrible and need the smoke to work.
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I think the smoke isn't a problem. There's many instant kill grenades out there that are more effective and annoying. The smoke with venom does hardly any damage (use of the smoke and watched many enemies unharmed) and it requires a mop up kill with a weapon. Truly takes more skill to use then it being OP.