I’ve worked out how to make it appear. You have to double-click on the Music Server. This opens a new window which you can ignore. However now the Music server entry in the original window has an arrow next to it. Clicking on that reveals the smart playlist!!
Now who thought up that poor design in iTunes?
OK, so now this works, I will double-check in XBMC and see if the playlists are populated.
Or you can just single click it. It’s a music source, just like any of the others on the sidebar there.