Burning Smell, then Smoke from Vent

So yesterday I was playing this game that my friend convinced me to buy on the Steam Store called "The Binding of Isaac", when I smelled a burning smell. I went downstairs to the kitchen and nothing seemed wrong, so I ignored it thinking it was something outside and went back to the game.
A few minutes later I smelled it again and looked up to see a puff of white smoke coming from the vent of my iMac. I quickly unplugged it and let it be for a few hours.
I've been using it very cautiously since yesterday, but everything seems normal. I'm super paranoid now. >.<
What could have caused it? Our air was off at the time and it was somewhat hot, so could it have been the game (Which I don't think is really that intesive... It's 2D.) + the temperature of the room?
And mainly, what should I do about it? Continue with normal use? Take it in to get it checked out? (I'd rather not do that as the nearest Apple Store is an hour away) I just got the iMac in December and it's the first Mac I've ever owned, I rather not say goodbye to it so soon.

A strong possibility is that one or more electrolytic capictors blew out.  What you saw may have been steam from the cap dying.  It may continue to work but there has been some damage that should be repaired so that one problem does not cascade into multiple problems.
Check your warranty status and if you did not purchase AppleCare when you bought the computer you must buy it while your normal warranty is still in effect.  That is one year from the date or purchase.  AppleCare provides fopr three years total of coverage. Otherwise you only have the one year coverage on your hardware.
Seven or eight years ago a supplier of these style caps changed their electrolyte formula.  The caps ran okay for a couple of years but then started blowing out,  When they did any numbver of problems would appear from bad video to shutting down and not powering up.  The last series of the old Power PC chipped iMacs suffered from this capacitor plague.  The problem has since been corrected but, like anything, it is possible that a cap in your system may have slide by quality control and now you see the results.
You may want to call AppleCare and see if on-site repair coverage is available for your system.  Look at the Apple Support web page to send an Express Lane case with AppleCare to schedule getting a call from AppleCare.  The number is 800-APL-CARE or the web site is: http://www.apple.com/support/contact/

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