I like your association of this song with the [i]Norma Deloris[/i] album, Kevin. The album was recorded in April of 1972; the song "Smiles from Yesterday" presumably early that year. (The episode that featured it aired on February 17, 1972.)
The only non-album track from the album sessions is "It Changes," which remained unissued until it was finally released on an EMI twofer CD.
In my imagination, a perfect single to release in 1972 would have been one that paired "It Changes" with "Smiles from Yesterday." Both are songs with TV show connections, and both share a certain amount of pathos and melancholia.
Regrettably, my knowledge of the circumstances surrounding Peggy's recording of "Smiles from Yesterday" is very limited. Jon Epstein is credited with the music, Jerry McNeely with the lyrics. McNeely was one of the main writers and creators of [i]Owen Marshall, Counselor at Law[/i], Epstein its producer. So, it would seem that this number was strictly a TV show affair, with no direct tie to Capitol Records. The label's files show no traces of a recording.
I agree that Peggy looked great in the episode, which also featured Hoagy Carmichael in a very good acting performance.
Ivan