Acting like a complete idiot. Presumably "the blue crack" is Drain-O Crystals. "Have you been smoking the blue crack?" is thus analogous to "Have you been drinking turpentine?"
Note that this usage pre-dates the use of "blue crack" as slang for Tylenol PM.
"A customer asked me today if I could see her computer screen through the phone. I asked her if she was smoking the blue crack."
when you're holding up your phone and making faces at it, as though you are taking a selfie, but you're really taking a picture of the person across from you or the wall or anything else that seems interesting but you don't want to be caught dead taking a picture of.
This action is often made more convincing by wiggling the eyebrows or opening the mouth, to pretend you're trying to get a Snapchat filter to work.