I have read the report you can download the PDF it has never been proved that it was a cigarette. The report does conclude that the furniture and partitions between balconies were not fire retardant however the ship was within safety design limits of the time that only extended to the inside of the ship. The standards have now been amended.
As far as banning smoking in cabins or on balconies I think it's overdue, even when I was a heavy smoker I never smoked indoors and went out on deck for a cig.
As people have paid a lot of extra cash for their own private deck space why should they not be able to enjoy the use of it without having to smell smoke.