Steps:

There are just only two steps

First, go to dashboard, choose Layout, then edit HTML copy this following JavaScript code snippet to your HTML template, right before </head>:

<script src='https://sites.google.com/site/gman/file/Emoticon.js?20110731' type='text/javascript'></script>

Last, add another JS code right before </html> in your code

<script type='text/javascript'> 

addSmileyById('comments-block');

addSmileyByClass('entry-content');

</script> 

Customize

This code is fit for most users, but if you want to show emoticons in some other places, you can change/add:

addSmileyById(_NAME_) or addSmileyByClass(_NAME_) with _NAME_ is the class name or ID name.

The class names for entry contents usually are: "entry-content" or "post-body".