SMART stands for Self Monitoring Analysis & Reporting Technology.
SMART is an interface between a computer's BIOS and the hard drive. If SMART is enabled when a computer is set up, the BIOS can receive analytical information from the hard drive and determine whether to send the user a warning message about possible future failure of the hard drive.
SMART monitors elements of possible long term drive failure, such as 'Spin Up Time', the number of start/stops, the number of hours powered on and the temperature.
I say enable it, but it doesn't really matter. I have some high-end HP workstations that will say "SMART has detected iminent drive failure", which is good to know... but I don't know if your computer supports that... so I guess you're mileage will vary. Enable it if you're feeling saucy.
har har har. Yeah, when you get a SMART error, it pretty much means the drive is going to die very very soon, and you shouldn't be trusting any data on it.
Although, you can run a utility like SpinRite from grc.com and if you are only getting SMART errors because there are a lot of bad clusters, at least you can mark them as unusable and the drive will still function fairly well.