You can redefine the headline beamer template as defined in beamerouterthemesmoothbars.sty to use \insertsubsectionnavigationhorizontal instead of the default \insertsubsectionhead; something along these lines:
\documentclass{beamer}
\usetheme{Madrid}
\useoutertheme{smoothbars}
\setbeamertemplate{mini frames}{}
\makeatletter
\setbeamertemplate{headline}
{%
\pgfuseshading{beamer@barshade}%
\ifbeamer@sb@subsection%
\vskip-9.75ex%
\else%
\vskip-7ex%
\fi%
\begin{beamercolorbox}[ignorebg,ht=2.25ex,dp=3.75ex]{section in head/foot}
\insertnavigation{\paperwidth}
\end{beamercolorbox}%
\ifbeamer@sb@subsection%
\begin{beamercolorbox}[ignorebg,ht=2.125ex,dp=1.125ex,%
leftskip=.3cm,rightskip=.3cm plus1fil]{subsection in head/foot}
\usebeamerfont{subsection in head/foot}\insertsubsectionnavigationhorizontal{\dimexpr\paperwidth-0.6cm\relax}{}{}
\end{beamercolorbox}%
\fi%
}
\makeatother
\begin{document}
\section{Test Section One}
\begin{frame}test\end{frame}
\subsection{Test Subsection One One}
\begin{frame}test\end{frame}
\subsection{Test Subsection One Two}
\begin{frame}test\end{frame}
\subsection{Test Subsection One Three}
\begin{frame}test\end{frame}
\section{Test Section Two}
\begin{frame}test\end{frame}
\subsection{Test Subsection Two One}
\begin{frame}test\end{frame}
\subsection{Test Subsection Two Two}
\begin{frame}test\end{frame}
\subsection{Test Subsection Two Three}
\begin{frame}test\end{frame}
\subsection{Test Subsection Two Four}
\begin{frame}test\end{frame}
\end{document}
Some zoomed images showing the headline for some frames in the first and second sections:

