Hey this is what I did to make rss work in templates simple.

Using this plugin
http://smarty.incutio.com/?page=RSSBlock

We've added the block.rss.php to /content/smarty_plugins.

Then we add these two lines below the comment in index.php
PHP Code:
// load additional smarty plugins & functions
        require_once("content/smarty_plugins/block.rss.php");
        $smarty->register_block("rss", "smarty_block_rss");

You have the rss plugin installed. You can now use it via the templates!

Code:

{rss file="http://www.php.net/news.rss" length="3"}
<a href="{$rss_item.link}" target=_blank> {$rss_item.title} </a><br>
{/rss}