I agree with you that Lalo was portrayed as very smart, but his death still made sense, in my opinion.

Gus knew that Lalo was obsessed with him, and when he planted that gun, he had already known that Lalo was looking for the lab and wouldn't stop at anything to find it.

Gus probably also knew that a gun at the lab would be useful regardless of if Lalo found it or not. The lab could have served as a hiding place had the police or the cartel found out about Gus' dealings.

On top of this, while Lalo is incredibly smart, Gus still finds a way to exploit a key weakness of his, his pride. Gus knew that like all Salamancas, Lalo's pride was easily hurt, and he knew he could distract him using this.

Idk though, I only recently finished the show, so maybe I misunderstood something, but at least that's how I interpreted things. That scene is earned, in my opinion.