The result Monday moved the Gunners up one place to 11th in the 22-team standings while City stayed sixth.
Smith turned in a center from fullback Lee Dixon in the 31st minute and Schwarz added the second with a neat chipped shot four minutes later after good approach work by Smith and Kevin Campbell.
City substitute Fitzroy Simpson scored a reply 10 minutes from the end with a close-range shot lifting the gloom surrounding newspaper allegations that manager George Graham received a ?285,000 ($416,000) gift for the transfer of Danish midfielder John Jensen to his club. Graham has denied the allegations.
Blackburn and Manchester United gained thrilling 3-2 victories Saturday, intensifying their neck-and-neck battle atop the English soccer standings.
Two goals from England striker Alan Shearer enabled Rovers to edge Southampton at Ewood Park while United, knocked out of the European Champions Cup on Wednesday, won at Queens Park Rangers with the help of two goals from Paul Scholes.
Rovers, which have 42 points from 18 games, heads United by one with the others at least four points behind.
Manchester United 3, Q.P.R 2.
Les Ferdinand scored his 11th goal of the season to give Rangers the lead after 23 minutes but Paul Scholes equalized 11 minutes later. Roy Keane gave United a 2-1 lead a minute before half time and Scholes scored his second goal of the match two minutes after the break. Ferdinand scored again for Rangers in the 64th minute.
Tottenham 3, Sheffield Wed. 1.
Ian Nolan gave Wednesday the lead after 38 minutes but Spurs turned the game around in the second half. Nick Barmby equalized after 61 minutes, J--rgen Klinsmann scored his 15th goal of the season after 72 and center-back Colin Calderwood scored the third.
Wimbledon 2 Coventry 0. On-loan Norwegian Oyvind Leonhardsen gave Wimbledon the lead after four minutes from Mick Harford's header on. Harford took a pass from Warren Barton to fire the second in the 17th minute.
More Results: See Scorecard
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