I had that same question Kings, and after going through several documents I
came to the same conclusion you did.

If we just rate-limit echo we will only prevent to be the reflector but not
the ultimate target.

Echo request storm -> smurf reflector
Echo-reply storm -> smurf ultimate target

Also it is always mention that ip direct-broadcast should be disable to
prevent smurf attacks if not really required.

Here are some of the documents I read and helped me get to that conclusion.
Hope they help and we all agree.

http://www.cisco.com/en/US/tech/tk59/technologies_tech_note09186a0080149ad6.shtml#topic3

http://www.pentics.net/denial-of-service/white-papers/smurf.cgi

http://www.cisco.com/en/US/prod/collateral/iosswrel/ps6537/ps6586/ps6642/prod_white_paper09186a00801dbf61.html

http://etutorials.org/Networking/Router+firewall+security/Part+III+Nonstateful+Filtering+Technologies/Chapter+7.+Basic+Access+Lists/Protection+Against+Attacks/

http://www.sans.org/reading_room/whitepapers/networkdevs/securing-ip-routing-remote-access-cisco-routers_234

-- 
Ernesto Gonzalez G.
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