the crank throws oil into 1 bank of cylinders and up the drain holes, into the valve cover.
this is only on one side, and i forget shich side that it, but the whole valve cover becomes emmersed in oil.
With a V or inline engine, the crankshaft is the lowest moving component that will come into contact with a high oil level... but the boxer engine design (Subaru, Porsche) has the cylinders and pistons on the same level as the crankshaft.
So what happens in a boxer engine when you overfill the oil? I'm curious, being a Subaru owner myself
Somebody (other than me) should try that in their soob or porsche and report back to us.
Just kidding. But regarding the smoke:
My experience with old VW 1600's and 2000's was it left a trail of blue smoke behind the vehicle, plus the oil had air bubbles in it.
I seem to recall some smoke once when accelerating in full throttle in a long tight curve; they oil may have been a little overfilled (~half qt.) but probably the lateral acceleration had more to do with this effect. I wonder how much oil made it to left cylinders.