My setup is almost identical to yours. The pellet stove flue outlet runs into a T in the fireplace, then 4" all the way up to the top, run inside an old 8" fireplace flue. I have the exact same smoke issue you describe here. It tends to happen when all of these conditions are true: 1. After a thorough flue cleaning 2. The outside temp is "warm" (in the 40s or higher) and 3. at stove light time. In short, it happens at the beginning of the heating season - each time I light the stove, when it's not *really* cold outside yet. The amount of smoke I get is very small. It's funny, the smoke is enough to detect via smell, but still nearly impossible to see, even with a flashlight directly on the affected flue area. I might see a little tiny column of smoke, but it disappears quickly. The cause is a subtle air leak, and the warm weather means you are not getting as strong of a draft to pull the smoke up the flue. As soon as the stove gets past the lighting stage, and the combustion fan really kicks in to get the air flow moving, no more smoke. I have also tried lighting a fireplace lighter in the area of the leak to see if there is enough air to move or affect the flame; nope. A little high temp silicon will definitely remedy the problem. For me, I have not been able to pinpoint the exact source, and believe me I have tried. The good news is, as it gets colder outside, the issue takes care of itself. In my case, it generally clears up within the first two weeks of the heating season. I believe the combination of the colder weather providing a stronger draft, in addition to the thin layer of the light brown ash that forms inside the flue naturally sealing the air leak, both effectively take care of the problem. Would I prefer to seal it with silicone? Yes, but so far I haven't been able to ID the exact location of the air leak, and since it takes care of itself so quickly, I've just accepted it as the norm.
