The original version is correct. The conversation should go:
Smuggler: "Desmond Ray Beltrop wants to see you."
You: "The head of the smugglers? Uh-uh. How about you just tell him my apologies for breaking his ban on entering Rheims' house?"
Smuggler: "You tell him yourself. That's not really why he's expecting you. If you think about it, you know where to find him."
You: "Okay, I'll think about it." (accept the mission, trigger the quest)
You: "No, YOU tell him that whatever he wants from me, he's not getting it." (reject the mission, don't trigger the quest)
@Hammie: the "quest_smuggler_02_dialog" files should now be in the main "DIALOG" folder, not in the storyline "standard" folder. It doesn't make much difference at the moment but some time I want to make this quest available as a "Trophy Quest" for FreePlay smugglers, for which reason a lot of other "Night Craft" stuff is also now in general files in NH. Also, there's now a follow-up quest to "Night Craft". That ends with you becoming hostile to Portugal. But the player might have had a Portuguese Letter of Marque and possibly some promotions. The BNH version has my old, quick'n'dirty solution - if you had a LoM, you immediately get it back along with your previous rank, and title if you had one, when "Night Craft" ends. The NH version instead allows you to talk to the governor to do something for him, in return for which you get your LoM, rank and title restored.