Smokers are a dying breed and their numbers continue to diminish. They are not getting more real estate. With the exception of the casino, smoking has been eliminated indoors.
The lounge has had other uses in the past including live entertainment and yes, even smoking, and is underutilized. The proximity to fine dining eliminates using for smoking.
Other Conquest class ships utilize the lounge better, sometimes offering comedy. Perhaps when Liberty replaces Glory there will be other offerings. Or maybe Freedom will provide a clue.