To answer both your questions, I've considered a smoke pistol, only reason I'm not doing that is I'm trying to do this on the cheap. In the end I'll have roughly $60 invested total. The smoke pistol runs roughly $50 by itself. Plus you have to use their wood bullets. I'd rather stick to something a little more versatile. Although I have no doubts the pistol is an excellent product.
Yes, I've seen the youtube vid, great idea, but for what I'm looking for I don't think I'll get a long enough burn. That's good for a couple hours tops, perfect for cheese, but I'm looking at doing locs, and also ham and bacon. I'll need a burn that runs hours, and I don't think a soldering iron will stand up to that kind of use. Maybe I'm wrong.
Keep the ideas coming though. Sooner or later something will hit me. Right now I'm leaning towards a turkey fryer burner and a second cabinet as a firebox. The welders blanket is definately a good idea though, didn't think of that.