Yeah, tapping noises are common with this engine and are harmless, other than perhaps to your sanity. If noise was the only symptom, I'd recommend running a can of diesel purge to clean the injectors - they can make this kind of noise. Then switch to synthetic oil - it can quiet down noise lifters.

But the part about the smoke bothers me. White smoke generally means steam, and that means coolant in the combustion chamber. I suspect you have either a blown head gasket and/or a cracked head. How is the coolant level in this car? Dropping?

- Jim