There's no sound in space either, yet there is in Star Wars, because it's much more interesting and cool that way. Likewise, smoking ships = cool
And there's always the argument that the ships could be leaking their own atmosphere due to hull breaches and such, therefor making fire and/or smoke completely reasonable.
As for so much stuff going on... it really doesn't look all that much more than the battle of Endor, honestly. I think that shot looks awesome, and can't wait to see it in motion.
And keep in mind, the camera isn't going to be staying at that same exact angle for the entire battle. In that pic, it looks like the cameras are following those three clone fighters, where they'll probably fly by some stuff shooting it (with the camera following them), and then it would most likely cut to something else. Just watch the camera work for the battle of endor or naboo to get what I'm talking about. (The battle of Endor was, after all, an entire FLEET of SD's, along with the Rebel attack force AND the second death star. This looks big, but it doesn't look that much bigger to be "too much going on")
(I see what you mean, though, but you have to keep in mind the context with which the shot was taken)
Moo.