I added some testing smilies and found that the list of smilies drops down to infinity.
Logically I'd say they must be arranging to the side automatically. Imagine 50 smilies and 100cm scrolling down for 5 minutes .
I don't think moving it is necessarily the better option vs. making the smilies dropdown scrollable for those who have large amounts of smilies... which lets face it, most boards want extra smilies.