Of course they will. Steve Smith was obliterating records as the no 1 bat in the world and on his way to being one of the greats of all time. I would not be surprised if he doesn't return in that form - you can't be out of the game (at international test level) for that long and just continue on in such a rich vein - not too mention all the additional mental pressure he will have to make amends/make up for lost time/answer his critics/etc. It's a shame as I feel we will be robbed of a 'generational' cricketer.
The penalties were so harsh due to public reaction and the fallout continues with the latest audit and 'nice guys' thing. The real reason I beleive Aussies are hostile to the cricket team is so many got used to Australia dominating everyone for about 2 decades. It became the norm to be so much better than everyone and when we became an average side, it was jarring, uncomfortable and the team lost respect and popularity. I mean everyone loved the cricket team in the 2000's and they were more abrasive, aggressive, etc then than now.