I like this theory. It fits in with one of my own; the one that says Jacob can become one with the souls of others who have died and make them appear to some of the Losties. This would include Walt (when he appeared to Locke), Jack's Dad, Vincent.
Here's a picture of a picture in Jacob's cabin. I think this dog is Vincent (dead).
LOSTTalk.net - Pictures - LOST_HDSC_S04E01_0431.jpg
I also think the whispers are from people who have died. Especially after seeing the mass grave in TTLG.
Jacob can also control the smoke monster.