Hi mandmharris,
Tunisia has a closed currency which means you can only exchange your money when you get there.Most of the hotels will change it and all of them are the same rate ,as it fixed by the government,within a penny or two.
If you need to draw money out,there are plenty of atm's around.We used the one just through the entrance to the port,and had no bother at all.If you need to tip anyone before you have changed your money,i just gave them a £1 or 50p depending what it was for.I dont smoke so cant help you on that one,allthough i brought some back for my son,but i just bought them on the plane.If you go to a site called Tunisia.com and type in buying baby milk in Tunisia,ther are a few posts on there which might help.Dont know about the towel situation there as we stayed at the Maharba Palace,but we had to take our own beach towels there.It will be hot in August,but its just a case of being sensible really.We have been to much hotter places than Tunisia in August,and saw lots of very small children really enjoying themselves.Don't worry about it.Im sure you'll have a great holiday.