Wood chips and ECB question: What did I do wrong?

I've previously made myself an electric flower pot smoker, but it's pretty small, so last year I bought a Brinkmann Smoke 'n Grill (ECB) smoker, knowing full well the problems it has and some of the mods to fix those problems.  I was doing pretty well with my locally available "Smoke Wood" compressed dust blocks (they work like an incense stick or the "punks" we used to use to light fireworks), but the last time I cooked, I tried to use chips.  I soaked them overnight in a bag of water, put them inside a double wrap of aluminum foil, poked a dozen or so holes in one side (designated as the top), and put the packet into the fire bowl.

Nothing for maybe ten minutes or so, then a brief burst of heavy smoke, then nothing.   I think despite the soaking and foil wrapping, the chips managed to flare up.  Question is, how to beat this?  I need the bowl pretty full of charcoal to get the heat levels I want, the drip/water pan stops me from moving the packet any higher off the heat. 

Less holes in the foil packet?  More layers of foil?  Not sure what went wrong.  I was able to salvage the bird with the Smoke Wood block, placed on a steel plate beneath the fire bowl; the draw pulled most of the smoke up into the body of the smoker, but chips are much cheaper and more durable than the blocks, which tend to disintegrate if not stored very carefully.

Suggestions?

-val

p.s. Smoke Wood, available in Japan: