I haven't run a generator on used oil but I have a car that runs on it and will shortly have another one once it gets some other work done to it.

There is a lot of misinformation as well as truthful information available about doing this sort of thing.

From people who are actually doing it to those who haven't even tried it claiming it won't work.

All I can tell you is this: my Mercedes diesel has been running on straight, filtered, used cooking oil for the better part of a year now, with an occasional gallon of diesel fuel when traveling or when my oil supply ran short. I don't have 2 tanks, I don't pretreat or preheat the oil other than running it thru my 2 barrel filtering system. While we've had a couple of issues with the car, none of them were traceable back to using the oil for fuel. The car puts out less noxious emissions using oil than it did using diesel fuel, that smoke you referred to was carbon being burnt off, a byproduct of using diesel fuel. There is evidence to suggest that using veggie oil is much cleaner than using diesel fuel. Most of the negative things you'll find are either produced by people who have never tried the process or who have another agenda.

There is a ton of information about these sorts of things on the internet, I'd suggest that you look up the biodiesel/svo webforums for a start, do a google search for them and then take what you learn, decide if you want to do the necessary work and make an informed decision.

I'll end with this, the inventor of the diesel engine, Rudolf Diesel,designed it to be run on vegetable based oil.

John E