"Slime! I want to take your Xs" was what I read.
Does that mean that I take things too literally? :p
I think context matters a lot! Smile/Slime is isolated, so that complicates matters.
Also none of the mixed-up words in the sample paragraph are really written to look closer to other words than they are to the right word, as Smile/Slime was closer to slime than to smile. That changes how you read the word, too, I think.
Finally, I suspect the words in that paragraph and the order of the letters was very carefully chosen. Case in point: I don't think there's any way to mix up the word "camera" and make it readable without some pretty clear contextual clues. cermaa? cmraea? creama? I don't think anyone would look at any of those and know what I was writing.
