Both teams had already made sure of their places in the Super Eights second round, but it's Ricky Ponting's Australians who go into the next stage with a valuable extra two points now tucked under their belts.
"A victory would have been terrific, but there is still so much cricket to be played in this tournament. We know how many games we have got to win to make the semi-finals," said Smith whose team now face Sri Lanka in their second round opener in Guyana on March 28.
"One of our strengths is our ability to pick ourselves up.
"It was a cracking game today and all credit to Australia, they played well," said Smith whose side tried in vain to chase 378 to win.
"We certainly had opportunities. They had 20 runs too many. It was a cricket reason, nothing else. We still move on with confidence."
Chasing a daunting target, South Africa lost their last nine wickets for just 74 runs after being well placed at 220-1 in 31.3 overs.
Smith, who made 74 despite cramps in his left leg, in the company of AB de Villiers (92) put on a quickfire 160 before the middle-order collapsed to some tight bowling from left-arm spinner Brad Hogg (3-61) and two wickets apiece to pacemen Shaun Tait and Nathan Bracken.
"The turning point was when AB and I, the two batters in, ended up being 'out' at the same time. It was a terrific run-out. AB was really playing well but then losing both of us at made it a rough point for us," said the skipper.
Once De Villiers was gone, and Smith retired, the South Afric innings lost its way.
"Even going into the 35th over, we were right in there. But it was just too much to do in the end," said Smith, who had to retire at 184-2. He returned with the score of 5-264 only to fall three runs later.
Australia opener Matthew Hayden hit the fastest hundred of World Cup history with his ton coming off 66 balls while Michael Clarke scored a 75-ball 92 and captain Ricky Ponting smashed run-a-ball 91.
Smith, whose team successfully chased a world record target of 435 against Australia at Johannesburg last year, said his opponents' total was reachable.
"It was a 'gettable' total. But we lost our way at times. Hayden played a superb knock. He really took the game to us and the wicket played well," added Smith.
"We just left ourselves too much to do in the last ten overs. It's disappointing but we still had opportunities to win the game, which is good to know."
Smith disagreed that the small Warner Park ground devalued the World Cup.
"It's a very difficult ground to defend on. When batters get going its difficult. It doesn't devalue. Both teams have to play on that wicket. It just creates a different sort of spectacle, and I think people enjoyed their day."