Here is the situation. Yu Jing is in the active turn. A Shaolin Monk is using its Extremely Impetuous Order. Directly in front of him is a Trooper with a shotgun. Directly behind him is a TO Maker (Ninja). The Monk throws smoke at his feat. This will cover LOS from the shotgun blast if it lands. The reactive trooper shoots his shotgun at the monk. He lines up the template to connect with the ninja as well. (Question 1. Can the ninja do anything???) Now, the Monk and the Shotgun unit face off. The monk wins the roll and places the smoke. (Question 2. What happens to the TO Camo marker that was in the template blast and why??) Thanks!
The Ninja can't do anything, as only you activated models do anything during your active turn. Impact template weapons are resolved individually with each unit affected by the blast. However, the target number for the shotgun trooper is based off the visibility mods of the main target (in this case, the monk) The Monk smoke blocks the LoF to the Shotgun trooper, so their rolls are FtF. If the monk beats the Shotgun trooper, he will not be affected by the attack. This does not mean the ninja is safe. Since the ninja is not opposing the shot of the Shotgun trooper, the shotgun trooper's dice will also be compared to the Ninja's (which in this case, is not a FtF). So if the Shotgun trooper simply rolls under his target number (based off of the monk's vis mods), then the Ninja will get hit. This is why you should always be shooting at the unit that has the lowest mods when using impact template.
If the Shotgun trooper was the active trooper, both the monk and the Ninja could declare ARO. Each of their ARO would be compared to the Shotgun trooper's order. Each of them would also resolve independently of the other's. But the Shotgun trooper's target number would still be calculated based on the monks visibility mod (no visibilty mod), even when comparing to the ninja (effectively ignoring the ninja's -6 mods)
I think Diphoration answered everything right, I just want to address one question. Usually when people ask this question in this situation, they're asking about a few different things. The answers to those questions are: When the template attack is declared, the template is put down and any trooper in the template volume is affected. The camo marker rules about not being targeted by attacks essentially only prevent them from being the primary target of a template attack. The attacker doesn't need line of sight to any of the secondary targets in the template volume. The only requirement to be affected as a secondary target is the absence of blocking terrain between the blast focus and the secondary target. Model A throwing smoke cannot prevent an attack hitting Model B, or create a face-to-face roll for it. The primary target's ARO doesn't matter as far as the secondary targets are concerned. They're all on their own. The template rules in N3 are kinder than they were in 2nd edition, but still end up harsh to the active player in certain circumstances. A reactive turn model affected by a template attack gets a Dodge ARO if it didn't have an ARO otherwise An active turn model affected by a template attack doesn't get any consideration. If it didn't activate as part of the order, it's just going to get hit if the attack succeeds. In summary: The TO Camo marker gets hits if the attacker's roll is a success, on its own. Camo doesn't protect it or make any difference in this situation, since the ARO Shotgun shot had to have the impetuous model as the primary target already.