[kangus]

You can upgrade; download the latest version of Smarty and unpack it, create a new directory under your store as in store/Smarty-2.6.9 then copy everything in the unpacked /libs directory to store/Smarty-2.6.9, rename the store/Smarty-2.6.9/internals directory to store/Smarty-2.6.9/core, edit store/Smarty-2.6.9/Smarty.class.php and change define('SMARTY_CORE_DIR', SMARTY_DIR . 'internals' . DIRECTORY_SEPARATOR); to define('SMARTY_CORE_DIR', SMARTY_DIR . 'core' . DIRECTORY_SEPARATOR);
Then edit store/smarty.php and change define('SMARTY_DIR', $xcart_dir.DIRECTORY_SEPARATOR."Smarty-2.6.3".DIRECTORY_SEPARATOR); to define('SMARTY_DIR', $xcart_dir.DIRECTORY_SEPARATOR."Smarty-2.6.9".DIRECTORY_SEPARATOR);

Then copy any plugin in the Smarty-2.6.3/plugins directory that is NOT in the new plugins directory to the new plugins directory.
File list:
function.count.php
function.assign_ext.php
modifier.abs_value.php
modifier.formatprice.php
modifier.substitute.php
modifier.trademark.php
modifier.value_sign.php

Seems to work.