As long as you're sure the source and process didn't taint the wood it should be fine. As for soaking, there's no need. You just control the amount of heat and air getting to the smoke wood to control the smoke and prevent flare-ups. In you case, you have various sizes of blocks which can be broken down farther to a usable size for you smoker.
If it's a charcoal smoker chunks are best. If electric with a chip-loader tube the pieces need to be smaller. A vertical propane smoker can benefit from the use of multiple sizes of smoke wood and is only limited by the space between the smoke wood tray and the baffle/water pan. Larger wood starts slower and smokes longer. Smaller wood starts faster and doesn't last as long. A mix of different sizes in propane vertical smokers can give faster onset of smoke and last for a very long time.
You don't want the smoke wood to go to flame, just smolder...not easy with small chips, but is doable if you think outside the box. A burnt-out soup can with smoke wood chips in it can provide a nice slow smoke when placed near the heat source, if all else fails. If you save the lid to the can you regulate the smoke output even more than with an open top can by just setting the lid into the can over the wood.
Just some ideas for you to ponder...
Eric