There are many timeshares that are totally non-smoking. If DVC wanted to make its resorts 100% nonsmoking, I am 100% sure it could do so. Anyone can sue for anything, but that doesn't mean they would win. Maybe DVC would just buy back their membership -
FWIW, it may seem that there "many problems with non-smokers getting smoking rooms", but it is really a very small percentage if you compare it to the number of people who have gotten their non-smoking request. People are very vocal about this issue - if you go by posts on this board, you will get a very skewed idea of how often it really occurs. Most who get stuck in a smoking room seem to be those who arrive very late in the day.
That said, I do wish DVC would at least guarantee non-smoking to anyone who books at his/her home resort prior to the 7 month window. I do not believe that would cost much to administer (if anything) and give those who cannot tolerate smoke a viable option.
Best wishes -