I'm not going to pick on the no helmet business, out here in OK we never wear them and I have never seen a barn or show that requires them unless it's in hunter or dressage classes. The helmet is the exception not the rule out here, so negligence isn't necessarily going to fly. We also have the "inherent risk law" here and sign waivers on top of that being posted. If a parent wanted the helmet on their kid, it would be up to them to put it on before the lesson or ride, if the trainer/barn didn't require them.
Smoking is a huge pet peeve of mine, I make people go out into the middle of the street in front of the property, I don't allow it ANYWHERE on my place. And that includes casual visitors.
Since the trainer is switching up horses on you, I really do think she's trying to find one that makes you progress and come along. I think she's just not reading you right and you need to tell her you're not ready for that. The rider has to be a little responsible for some communication and by going along like this for a year, she's probably thinking you're liking it.
Trainers are not Gods and not omnipotent and all knowing. Too many people say, "Well, my trainer says I.........." or "I have to ask my trainer........." instead of taking charge of their own learning program. When I go to a trainer I spell out exactly what I need (I've recently started showing at stock seat shows rather than Arab shows, I need to learn the rules and different styles of riding) and what I want (I want to ride at the upper level shows like AQHA World) and my time frame (I can only afford 6 months of training for me & my horse). That tells the trainer just how hard to push and how long he can push me and in what direction. If at any point, I don't agree with what he's doing or don't understand what he's having me do, I stop dead in the water and I start asking questions until everything is clear. I don't know what board & training is out in VA but here in OK it costs me around $500-1000/month depending on what kind of trainer I'm at. No way do I shell out that kind of money every month and not get what I'm after.
It may be time for a new barn but first, since you say you're over all happy, I'd sit down with the trainer and talk to her about your fears, expectations, wants and needs. Besides asking for a new, Steady Eddy horse, set some goals. She is making money by the lesson, if all you do is go out and trot and resist working the canter, she'll let you for the next 50 years, it pays the same. If YOU want to progress then you need to say, "I want to be comfortable at the canter/lope by June 2013. I would like you to really work me on that, on a lunge line if need be, until I can feel the rhythm and get with the motion so that I don't lose my seat after a few strides every time.". Spell out what you want, when you want it and how you want to get there. That lets her know how hard/fast to push and what you're comfortable accepting from her.