Smith said: "We've got four games in 10 days and, for us, the league is obviously an important factor. But that's not to take away from tonight's game.
"I wanted to do well in the game and I thought we worked very hard. A lot of our younger players came in and did very well. It was just disappointing that we lost out so late in the game.
"The most important thing for our club overall is to win the league championship, that's the most important aspect. Four games in 10 days would be a lot to ask of any group so we made a decision to change the team around.
"That's why the majority of big clubs have big squads of players - we don't and we had to change it around."
Rangers threw away a 3-1 lead when they were pegged back to 3-3 by United at the first time of asking and Smith believes that result at Ibrox is what ultimately cost his players a last-four meeting with Raith Rovers.
He said: "I'm disappointed but we have to look at the game at Ibrox as being costly for us. We were 3-1 up there and should have been able to see the game out.
"We weren't able to do so and suffered the consequences this evening. I'm not saying that we had the game at Ibrox won because we ended up drawing.
"But, at 3-1, we really should have been able to see the game out at home and we should have handled the situation better than we did.
"That was the costly aspect for us, more than even tonight's game. In the end, you can't begrudge United their win."