Propane combustion should have very little odor, assuming the air/fuel ratio is normal.
If you are seeing soot, the burner orifice might be plugged. I had a bad gas solenoid that caused soot. It will cause some odor as well.
Check the exhaust stack, using a mirror if necessary. Insects can build nests and block the stack. (Already mentioned in a previous post)
The smell concerns me, so I would also check that there are no loose wires in contact with any hot parts. Scorched insulation will create an odor.
Adding foam to stop a problem you haven't solved yet doesn't strike me as a good idea.
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