All I can say is that they are very temperamental with their carb settings. Running lean will burn a hot spot on the piston crown, but sounds to me like yours is running rich [too much oil]. 2 strokes normaly smoke a lot until they are warmed up. Did you get it nice and hot? If you did and it still smoked a lot then maybe it is rich.
Is it pre-mix? ie; Do you have to add 2stroke oil to the fuel, or is there a seperate tank to put the 2stroke oil into. If you have to add it to the fuel, you have to be sure you get the correct ratio.
Spose there could be ring damage. But this is easy to check on 2 strokes. I was always having the head and barrels of my bikes, and never replaced the gaskets. Not like a 4 stroke where you have large comp ratios, and have to stop oil and water mixing.
We all know that with cars you have to warm them up gently before you give them any stick, but 2 strokes if you let them idle from cold they smoke like hell when you start to give them some. If you go to a race meeting and watch the 250's starting up in the pits, they rev the nuts of their bikes until they stop smoking. I think they are then considered "warm"