Not Playing Super Smart in $100 Tourney

Once a month we play a $100 buy in tournament at the American Legion.  I had high hopes as have been running good with two straight cashes there, plus lots of online wins.  My day started well playing very tight early on and winning a couple of small pots with pocket kings and aces.  A table broke and we drew new seats which turned out very bad for me.

I was seated next to a very loose player who had chipped up (and down) catching very lucky.  He had knocked out a great player when he called his all in A/10 suited with a Q/6 suited and made a straight with his 6.  With blinds at 200/400 and a 4000ish chip stack I raised to 1600 with 3 limpers and pocket 8's on the button.  Mr. loose caller and one other player called.  The flop was air for me J/10/7 and if I had any bluff aspirations, Mr. loose went all in before my action.  I snap folded and the other caller tanked for a moment before calling for all of his chips with KQ suited for an open ended straight draw.  Mr. Loose revealed his powerhouse KJ offsuit!  Total donk calling for 4x the BB with that.   It naturally held up and he doubled up.  The very next hand he min-raised to 800 and I discovered a K/Q offsuit.  With only 2100 in chips remaining I foolishly reraised all in hoping to catch him with a small pair, isolate him and get lucky.  He called, turned over A/J offsuit.  Not so bad I thought, two live cards and one undercard for him.  My calculator shows it as almost a coin flip.  The flop was great, small with a queen.  The turn a brick, then the ace on the river.....he caught a three outer bucking big odds.

My question to myself (and you) is:  would it have been better to smooth call the preflop raise, then shove when I caught my queen?  He probably would have checked the flop having missed, or even if he bet minimum might fold to the all in.  He was sooooo loose that I am thinking that my original play was best, trying to eliminate blinds and others from entering the pot.  Will never know for sure.