1. While he's free to sense magical auras around objects, many items in Abraxas employ some amount of magic to function and operate, so it may not tell him much. For plot purposes, there might be times when this ability would be restricted or limited. We generally trust players to contact us if they have questions about abilities used under particular event-related circumstances. For example, if there is a plot-critical NPC in disguise, then that NPC would simply be too powerful for him to sense any concealment magic. However, if he'd like to identify a non-plot NPC tricking him on the street, that's completely fine.
2. A size limit to something of an average predator (i.e. a bear) is acceptable. He can also shapeshift into substances, but this would be subject to possible restrictions such as wards (which a plume of smoke wouldn't be able to bypass), NPCs or other players who might sense that he isn't actually a plume of smoke, and the potential risk of being forced out of his shifted form if game plot mechanics require it.
no subject
2. A size limit to something of an average predator (i.e. a bear) is acceptable. He can also shapeshift into substances, but this would be subject to possible restrictions such as wards (which a plume of smoke wouldn't be able to bypass), NPCs or other players who might sense that he isn't actually a plume of smoke, and the potential risk of being forced out of his shifted form if game plot mechanics require it.