If it were me, I would go with particles. You can change the Particle Render type to "cloud" then create a simple white shader to assign to the particles, being sure to make it a bit transparent. To change the radius of the particles emitted, you can click the "Current Render Type" buttun under the "Particle Render Type" and adjust the value as you see fit. After that, you should be able to manipulate the particles any way you want with fields. If you want the fog to move away from your character, you could parent some air fields to his legs or something. That's probably not the best way to do it, but it's what I would do.
Also, to get that "wispy" effect, you could create a vortex and key the magnitude according to how you want it to look like. Create several of them and set their max distance to 1 or 2 for a good effect. Izzy has a tutorial somewhere in the tuts section that goes through the proccess of creating a fire ring explosion. I learned a lot about particles by watching that.
Last edited by Darkware; 07-02-2003 at 04:31 PM.