0) (If Smart Lock is enabled, navigate to its settings, ensure "Unlock device only" is selected, and disable the feature. This simulates a new Smart Lock setup)
1) Enable Smart Lock.
2) Either lock the screen or sign out. Notice that if you lock the screen, Smart Lock will be working fine.
3) Unlock or sign in (doesn't matter if done with password or Smart Lock)
4) Navigate to Smart Lock settings and select "Unlock device and sign in to Google Account".
5) Either lock the screen or sign out.
6) Observe. There's a greyed out icon whose tooltip reads "Enter your password to enable Smart Lock. Next time, your phone will unlock your Chromebook. Turn off Smart Lock in Settings". (If you locked the screen, notice that Smart Lock is now *not* working)

If you enter your password and then lock the screen or sign out, Smart Lock will work as expected again. But 6) is clearly not intended behavior, especially if you locked the screen both times: why would enabling SignIn with Smart Lock disable Unlock with Smart Lock?

Note: this issue is only reproduced by exactly following the steps. If you enable Smart Lock and select "Unlock device and sign in to Google Account" before locking the screen or signing out, this issue will not manifest; Smart Lock will continue to work fine.

I filed a similar bug  crbug.com/892487  earlier. I can't reproduce its exact details; but it's so similar to this issue that I suspect its behavior slightly morphed into this issue. Duping.

Requires investigation.