One of those signature Weakness that can end the Campaign. Looking at the two elements, the effect and the discard condition, we get:

The effect: Draw an enemy, then someone has to kill it by the end of the scenario or Zoey gets hurt. The nasty sting is that if Zoey is taken out by damage or horror, she ends up with 2 Trauma for her troubles. If you are unlucky enough to have this happen a couple of times, it's new investigator time. Fortunately, unlike Searching for Izzie, this card asks you to do what Zoey always wants to do.

The discard condition: Well, you discard it when the enemy gets killed, which is exactly what Zoey wants to do. It can be extremely variable, since you can draw a Swarm of Rats or a Servant of the Lurker. Drawing an Aloof enemy is, of course, extra annoying. It also benefits from the "loophole" that anyone can resolve it, so if a very weak enemy comes out or another investigator is combat-ready, this can be dealt with pretty easily. As usual with this style of Weakness, when you draw it is critical, as is the map. Drawing it one turn before Resigning or dooming out in The Unspeakable Oath is way worse than drawing it early in The Secret Name. It can take anywhere from 2 to 6+ actions to clear, so it is a very situational weakness. You can mitigate the effects with "Get over here!" or Righteous Hunt.

All in all, this is an above average signature weakness, maybe average if all of the investigators are combat-ready.

So playing yesterday as Zoey on Where the Gods Dwell, and some of you will already now know where this is going, and I draw Smite the Wicked and the first enemy I discard is a copy of Nyarlathotep.

So what's the interaction here?

I knew that StW overrode Spawn instructions but what about Peril/Hidden and Revelation effects?

In this particular instance it didn't make much difference as we were soon to fail, so I just added it to my hand and took a point of Horror damage.

But should of I spawned Nyarlathotep and he then behaves as any other Hunter Enemy?

I disagree with people with people saying Smite the Wicked is a punishing weakness. If anything, Smite the Wicked, while it is not as tame as Arrogance and Whispers from the Deep, it's one of the few weakness which is very likely to be beneficial to the player.

Spawning a monster is a very punishing effect on average because monsters tend to be deadlier and more time consuming than treacheries, and it is a monster you MUST defeat, otherwise you will suffer a mental trauma, which can lead to quite a conondrum if you only have few turns to complete the scenario and the weakness spawns a very dangerous monster. There is also the possibility of you drawing this JUST before you were about to win and now you have to spend more time to catch up with a monster in order to defeat it and avoid suffering Trauma.

But these situations I have described are the absolute worst case scenarios, because you have to consider this weakness in the context of what Investigator it belongs and how their gameplans go, to understand why it is really not that bad:

1) Zoey is one of the best fighters among investigators, but she can't investigate for a damn without proper tools like Sixth Sense, so her main job is to defeat enemies. She GAINS cash facing enemies too, so she is encouraged to be highly aggresive. Chances are, Smite the Wicked won't affect her too much by spwaning an extra monster because Zoey will already have murdered most of them. And mind you! If she did actually murder every monster and then she draws her weakness, it will just discard the whole encounter deck and reshuffle it, failing to resolve before discarding itself. VERY RARELY a weakness fails to harm you in any tangible way, and unlike signature weaknesses like Rookie Mistake or Caught Red-Handed, it doesn't reshuffle itself when it cannot trigger its full effect.

2) Many enemies are designed to be a roadblock to the player, they are supposed to prevent them from acting and advancing the scenario. That means it is very likely an enemy spawned by Smite the Wicked will impede your progress and get into Zoey's range. Sure, it can definetly land on an Aloof enemy on the other side of the map, but that is a rarity compared to attaching itself to Hunter that will come your way anyway from across the map.

3) Maps that are structured as hallways are a rarity, more often than not, they take the form of a circular, squared or otherwise compact area, so enemies summoned by Smite the Wicked don't usually spawn that far away, especially if Zoey is at the centre of the map when she draws her weakness. Also if any effect that changes the map would cause enemies to get discarded for any reason, then Smite the Wicked would also get discarded. The only situations where this weakness actually get scary, are in Edge of the Earth and Innsmouth Cospiracy, because of how HUGE the maps in the scenarios of those expansions tend to be.

Now with "why I think this weakness is not that bad" out of the way, let's talk about the main reason why I think this weakness can be a boon in the circumstances

Easy answer: it DISCARDS encounter cards while searching for an enemy.

Like I cannot understate how powerful that is: you have absolutely no control when it happens or how it happens, but the whole fact this is has a chance to discard 1 or MORE very nasty trecheries like, say, Ancient Evils, is downright incredible!

On the Hunt is already considered a decent card on its own because it can make a Guardian deal with an enemy instead of a treachery, which is a preferred outcome, its level up version even more so. So what about a version that straight up DISCARDS encounter cards in exchange of a drawback if you don't defeat an enemy?

I will say that this aspect of Smite The Wicked is less noticeable in 4 players because you are likely to go through the encounter deck multiple times, but in situations where there is a low player count of 2 or you are playing Zoey solo, this weakness can and WILL save your hide sometimes.

In conclusion, those are my thoughts on Smite the Wicked: it is a weakness I will be far happier to deal with than the absolute amount of drek that is Searching for Izzie or ACTUAL campaign ending threats like Abandoned and Alone and Dark Memory. The only time where I think Smite the Wicked is truly horrible to deal with is in Forgotten Age, as it has a chance to attach itself to Vegeance enemies, but that has less to do with Smite the Wicked being dangerous on its own more with Forgotten Age being designed like absolute crap.

I DREW THIS CARD ON THE LAST TURN OF A SCENARIO. But it's not that bad anyway it could be worse and Zoey likes engaging and killing monsters so if you draw it early or mid game then you can get rid of it easily