i'm an.. older... c programmer, not much into games.. this is a weird post and not meant as a criticism or detriment. the way the character moves, key down yes key up no is typical and a stylistic choice. i figure your engine probably has its own way of doing this but a lot of devs seem to do things the same way. you can smooth anything using the same formula for LERP:
value = value + w * (ideal_value - value);
what game developers don't like to recognise is that the w term there, isn't just "0 to 1 linear interpolant" it's angular frequency or "w" which is 2 * pi * frequency_in_hertz / samplerate and equivalent to a 6dB lowpass with the cutoff frequency at -3dB. (this is dsp, you can learn it from an old, simple text dspguide.com which will give you more education than game developers can relate to for reading it sitting on the toilet for a week). congratulations on getting this together and complete in time!