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If the chips are on the smaller size you can mix them 50/50 with pellets and they will smoke fine. I've done it at work multiple times! If the wood chips are on the larger size there will be to many gaps and ignite and burn.
We have had it a while, we didn't pay that much for it. Will be the last blender we ever buy. We are an hour+ away from everything. After the second 2.5 hour journey to replace your elcheepo blender I bought it. Nice knowing that when you need a blender it is going to work. She uses it several times a week, has never had to worry about out not having the power to grind anything up.