Chimney flue repair before installing liner for wood burning insert

Raising the flue may help a bit by increasing the draft. The direction of the smoke once it exits the chimney is totally dependent on the weather, winds and atmospheric pressure. You will notice that the smoke will go up when the atmospheric pressure is low, and will linger or drop in high pressure.

Raising the flue temp would require they open the damper and burn the wood more rigorously. This is often counter productive and sucks more heat out of the house than it puts in. Also in the case you site, a single wall metal flue could become extremely hot, especially close to the firebox. The smoke will exit the flue more vigorously, but not necessarily raise far enough before it cools to cure the problem.

Here in Maine where many folks heat with wood, the exhaust smoke is becoming an issue in more densely populated areas. There have been many stories on the news, and experts talking about new wood burning technology, but no one has found a way to reduce smoke pollution from older units, airtite stoves or folks that burn damp, or not fully dried wood.

Hard to say without seeing it, but typically you can use the existing flue provided you add the proper direct vent chimney insert for your particular gas fireplace. Alternatively, you can possibly knock a hole in the back of your chimney and just go out the side if you'd prefer (more labor, but less flue inserts you'd need to purchase).

UPDATE:

We actually did this recently. We ended up taking a direct vent unit and have the exhaust going through the existing flue (about 20'). For intake air, we're letting it take it from inside the house (since this isn't a primary heating unit, the loss in efficiency isn't a big concern for us). We've ran it a few times and seems to be working just fine.