Brian,
Are you using a serial port sniffer to view the RS232 traffic? While there's a pattern in the data, I've seen the same pattern from an airplaine traffic avoidance system, only to discover that I was reading at the incorrect parity or bit length (7 vs. 8 bits) -- after correcting it, the pattern went away, and a new pattern emerged that was in good human text.
If you're "sniffing" and the Lifescan software is simultaneously receiving the data with no problems, then that certainly is a weird data format. Otherwise, the "mean" engineers have decided to transmit the data in a obfusicated binary method. The only way to "crack" that is to get a data transfer performed on a meter, then add one value, and transfer again, and then "diff" the two, and try to extract a pattern.
The OneTouch Ultra transfer protocol, I recall, was in text, with a checksum value added at the end of each line.
Do you have the RS-232 communications specification document for the Ultra meter? If not, let me know, and I'll get my old computer out and booted and will send you it... It's been two years since I've looked at it, so I don't know how detailed it was (it was a very short document, and you probably already have it).
I sort of assumed they would have kept the comm spec the same for the UltraSmart, only with the addition of the insulin/med/exercise/(and so on) data. *grumble*
Think Lifescan would be kind enough to reveal

their format like they did for the Ultra?