When using smite, you select a primary target who is damaged. The energy the arcs to damage "any creature" within a distance determined by the PR.

Does this mean that if the Librarian is too close to the primary target that he may be damaged by his own attack?

It can certainly hurt allies, I don't see why it wouldn't hurt the user.

Yup, it can hurt the psyker manifesting the power, if he's within range.

A GM had the big bad cast smite on one of us when we were right in his face. One of the three was a chaplain, made his rosarius save, other two had storm shields. One failed the field save but dodged, but the poor sorceror took himself into crit as he failed his field save as well.