The default rule under the Constitution is that even inferior officers must go through advice and consent from the Senate, unless Congress "by law" states otherwise:
He shall have Power, by and with the Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur; and he shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.
Art. II, § 2, cl. 2.
From there, it turns into a statutory interpretation issue of 28 U.S.C. § 515(b) and 28 U.S.C. § 533. Do they provide for such appointments of someone with Smith's powers and responsibilities and just how clear and precise does the language need to be? The first statute appears to be Smith's strongest argument. She obviously rejects both, see pgs. 26-52, and then throws in separation of powers concerns on top of that. Pg. 52-57.