Wow, Interesting discussion, I need to get out of OT and Basses more. A few points on how I look at it as a listener.
How do you tell the difference between smooth jazz and jazz?
First, I need to establish where I'm coming from. I came to Jazz from a Rock-Blues background. In the early 70's my favorite bands were Cream, Allman Brothers, Free, etc. The more I got into music the more I started appreciating bands like Earth Wind and Fire and Chicago. As I was just starting to play I read an interview with Robert Lamn of Chicago and he mentioned Herbie Hancock as an influence. I heard he was going to be on PBS so I checked it out. The opening act was Return to Forever (this was early-Stainly was still playing a Fender J).
I quickly became a fusion snob, Weather Report, Steely Dan, Headhunters, Jaco, Mahavishnu, Miles, and later Metheny. I rarely bought any pop cd's after about 81. Although I still played some on bands. By about 90 I had tuned out pop altogether and became a Golden Era of Jazz fan. I now have just about everything Miles, Coltrane, Dexter Gordon, Sonny Rollins, Wayne Shorter, Herbie Hancock, Bill Evans, Sonny Stitt, Hank Mobley, Kenny Burrell, Grant Green and Thelonious Monk did before about 65. Of the Modern Artists I like Joshua Redman, some James Carter, Brad Meldah, Larry Coryell and of course Pat Metheny.
1) You can't judge by popularity, the two best selling Jazz albums ever are Kind of Blue and Time out. I doubt anyone could seriously say they aren't real Jazz albums. Miles Davis was the best selling artist on Columbia records in 1960. People forget, Jazz was pop music.
2) I appreciate good melody and good improvisation in contrast to that good melody. You won't see Song X, Zero Tolerance for Silence or Ornette or the Chicago Art Ensemble in my collection. I'm not sure its "improvisation" when it occurs in a vacuum. To me Free Jazz is like watching a basketball game without hoops, it gets boring real quick. I have no problem with players who play out as part of their exploration. But Melody is still a huge part of what makes a great song.
3) To me the big difference is the willingness to take chances. The great fusion players educated and elevated their audience, basically the jam band audience for classic rock. Where I see a lot of the smooth jazz artists fail is that they refuse to introduce any ideas that force their audiences to listen consequently it becomes elevator or background music.
4) For most musicians music is a passion but it also has to be a means of income. The really good players play all the time in a variety of situations to make a living at it. I respect that some compromises have to be involved in that. There are a lot of musicians that cross over, Herbie Hancock comes to mind, Grover Washington played some great jazz in his era, and many consider him one of the founders of smooth Jazz. I certainly don't consider either one less of a Jazz musician because they haven't restricted their careers to blowing over Giant Steps.