How come my MOSFET was a "smoking", I thought it was rated high enough.

apples:
Okay I have made up a diagram, and have noticed a wrong hook up. You will see a red line where it is wrong.

Yes it is connected to a PWM output on the arduino.

I have a smaller mosfet to turn the bigger one one, like a darlington pair I guess.

See the schmatic.

Yes, that is a mess and the red wire is confusing, it's wrong because it's there or it's wrong because it wasn't there and you added it? Either way that is not a good gate driving circuit because it's relying on a passive pull down resistor to turn the large mosfet off, which means it has to allow for a time constant of 10k ohms X the mosfet gate capacitance to fully turn off, which means the mosfet is dissipating significant heat while in that slow transition time from on to off.

A far better solution would be to just use a 'logic level' power mosfet to begin with and eliminate the need for a 'driver' mosfet. Here is an example that would work well. https://www.sparkfun.com/products/10213

Lefty