I just wanted to comment on position of cigaret during inhale, but astraldata already created good edit of it. Only problem with this edit is that smoke comes out of her mouth right after cigaret is moved which is unrealistic. Smoker hold the smoke in his lungs for at least couple seconds. Other than that it's good. 
I actually overlooked that smoke exhalation issue in my edit (which took all of 5 mins) -- my animation preview timing was really off due to my CPU load at the time (those new touchscreen tablets suck -- buy a proper laptop instead!) so it looked alright to me since I likely didn't even see the smoke frame due to its speed setting and my computer lag. x'P
I liked that chest animation you made. It's not realistic, and so what ? The style isn't realistic so I don't see why animation should be. Plus, at such small resolution, some exaggeration in movement helps readability.
I agree with you only partially on this because of one thing really:
Art style aside -- exaggerated movements are great for exaggerated actions, but exaggerated actions aren't great for exaggerated poses.
Already smoking a cigarette is a subtle action -- in an already exaggerated pose -- so it doesn't need anymore exaggeration in the animation because it breaks the exaggeration of the pose when doing so. The boobs were a bit too large to show the diaphragm getting much larger without moving the entire spine/etc., which would in turn move the rest of the body along with it. The brightening of the cigarette in the girl's mouth was enough to indicate the breathing-in and allowed a chance to gracefully avoid breaking the impression of the large breasts and the jut of the hips while keeping the body in a pose that exaggeratedly expressed the woman's "I don't give a damn" attitude. Turning her pose temporarily into a superman/mary-sue pose kinda kills that effect since the sideways-spine near the jut of the hips was a very important part of expressing that perceived attitude. Any attempt of doing something different with the spine (to simulate breathing in this case) took away that effect almost immediately -- and, additionally, since that movement took the eye away from the cigarette burning more brightly while it was in her mouth, it really didn't help the readability of the action as a whole -- its gestalt -- at all.
With that being said, I appreciate your desire for more exaggeration in the movement, and maybe a shift of her body/head/shoulders/arm while she breathes-in might suffice to allow her spine some more interesting movement -- but there's not a whole lot you can do at this size to show subtle movement like breathing in the first place without breaking the shapes/forms of more vital parts of the character (in this case, boobs/hips/spine of a very strong pose).
