Thought I'd add my 2 cents as a Hawaii drz-sm rider. First of all, the sm is great for commuting around Oahu and street riding in general. It's actually a blast to ride in traffic and for general street hooliganism. Unfortunately there are only a few off-road areas here on Oahu. I take the occasional off-road excursion with Mr Batman and found that the sm does okay off-road on moderate trails. Be warned though, mud or wet Hawaii red dirt = face plant. Dry conditions are okay and I've had a blast trying to keep up with Mr Batman on the trails. I feel more confident and have more fun off road on the CR250, but the drz-sm suits my needs for occasional off road and just rocks on the street.
So the regular drz may fit your needs better if you plan on hitting the trails every weekend and doing some more technical stuff. Mr Batman did great with the stock drz tires both on and off road. He just upgraded to some serious mx tires and he was still keeping pace with me at 90 mph on the highway last weekend. Although his back end was all over the place. Course I couldn't keep pace with him off road.
Just figure out how much dirt you plan to ride in. I wanted a street bike that would handle dirt. The regular drz seems like a dirt bike that can handle the street. If every weekend then go with the drz. If its only once a month then I think the sm will be more fun on the street. You can also barge your bike over to neighbor islands with more off road for about $70. A new super ferry will be here in 2007 to make off island trips even easier.