We gave up on the smith station and the diesel.. its far easier to just mine some shale and use the chemical station. So far the smith station is the only one that really has issues we've run into.
Oh, incase they don't know, they don't have controller support button selection for the popup menus... you have to use kb/mouse for them.
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The problem we saw was we had all the parts, but the diesel didn't highlight like it could be crafted. We tried every common kb/mouse to select it to craft, but nothing looked like it did anything. Do you have to level up the smith at the station before he will make specific items?