Generating smoke is really about controlling the fire
You need 3 things for fire.....
- Ignition Source
Without all 3, you won't get fire
Too much oxygen or draft, and you get high heat or flame and little smoke
Too little oxygen, and you generate creosote and other nasty chemicals
Using an electric element as your Source of Ignition, and Wood for Fuel, but not allowing enough oxygen for a proper burn will cause creosote to form.
Adding moisture to the mix will also cause the particles to condense, rather than flow freely out the exhaust. You should close the intake to control the oxygen, not close the exhaust.
If your chips or chunks are turning black, and not burning completely, you're making charcoal. Charcoal is pure carbon that's formed in a low or no oxygen atmosphere.
If the OP can't get a complete burn, it may be just as simple as adding an extra hole for intake air