Really easy. On the right hand side there are a bunch of smilies. There is a [More] link. Push it and you are there. I tried doing it your way by manually entering the smilie characters but my programming skills couldn't keep up.
Yeah, believe it or not, I don't have that option. Tried it on multiple computers, running Windows 7, IE 9, Opera, at work and at home, and for giggles just tried it on my laptop running the latest versions of Ubuntu and Firefox, no bunch of smilies or [More] option exists. I suspect it might be tied into my user account somehow, perhaps there's an "advanced editor" feature or something that I need to turn on? No idea, and it's not like this website is exactly "user friendly", haha. :p