can water benders heat like they can frez

They can freeze but i dont think they can heat thats like another element fire.But they can make steam ;)

there is a difference between smoke and steam. steam is evaporated water. (this is what katara uses) smoke comes from heat, A.K.A, fire. (this is what zuko uses)
on another note, GO ZUTARA!!!!

Ye, remember what Katara di when she froze Azula in the ice during the Agni Kai. Sher froze Azula and then melted herself out of the ice to chain Azula to the vent.