Genesis 15
13And he said unto Abram, Know of a surety that thy seed shall be a stranger in a land that is not theirs, and shall serve them; and they shall afflict them four hundred years;
14And also that nation, whom they shall serve, will I judge: and afterward shall they come out with great substance.
15And thou shalt go to thy fathers in peace; thou shalt be buried in a good old age.
16But in the fourth generation they shall come hither again: for the iniquity of the Amorites is not yet full.
17And it came to pass, that, when the sun went down, and it was dark, behold a smoking furnace, and a burning lamp that passed between those pieces.
18In the same day the LORD made a covenant with Abram, saying, Unto thy seed have I given this land, from the river of Egypt unto the great river, the river Euphrates:
19The Kenites, and the Kenizzites, and the Kadmonites,
20And the Hittites, and the Perizzites, and the Rephaims,
21And the Amorites, and the Canaanites, and the Girgashites, and the Jebusites.
:think: It appears that the descendants of Abram went to Egypt for four hundred years, and that land is not theirs, despite the affliction they went through.
The land of the Amorites was promised, along with the lands of other tribes.
The most interesting part of the promise is that the descendants of Abram were prevented from taking the promised land because the inhabitants would not reach a sufficient level of iniquity for four hundred years.
Looks like both your suppositions are correct.
They were smoting the people cause they're in Isreal!
It is Isreal cause this is where the people needed smoting!