After watching episode 609 (Season 6, Episode 09), the "are they dead" question is really brought back into focus. At this stage, it appears that Jacob is in fact, some type of God type figure, and Smokey (my favourite nickname for him) is some type of Devil type figure. Jacob's plan of bringing people to the island to see if they do things his way or the wrong way is very similar to the Garden of Eden and Adam and Eve from the Bible.
Now, the writers have said several times that they aren't dead, and they aren't in some kind of purgatory, heaven or hell. Recent episodes would suggest otherwise.
Given that the Smokey Vs Jacob seems to be a kind of massive deal, it kind of makes the last 5 seasons seem a little... irrelevant? I mean, given that the island is more or less a battleground for Jacob and Smokey, whats the point with the Dharma folks? What does it matter about Widmore trying to kill everyone on the Island and get it back for himself? The whole Ben vs Widmore appeared to be something to look forward to, but now seems like a pretty secondary storyline. And what about Jack/Kate/Sawyer? Seems like a pretty small thing when Jacob is trying to stop Smokey destroy the world.
And am I the only one that thinks its stupid having Smokey appear as Locke? To me, it just sounds like an excuse to keep the actor on the show despite the character being dead several seasons ago!