Hello Goodman
Yes, that sounds reasonable – the equivalent of the original would be:
1. I was sitting in my room last night and (I was) reading a book and (I was) smoking a cigarette.
where "I was" is omitted.
But it also occurs to me that it might be possible to use intonation to force a reading where "reading" and "smoking" were parts of the past progressive tense. I'm not sure how to convey that here, though; unless:
2. I was sitting in my room – reading – smoking.
This seems to require a very strong and equal stress on the first syllables of "sitting", "reading" and "smoking".
But I may be imagining it...
MrP