Northland police Search and Rescue co-ordinator Senior Sergeant Cliff Metcalfe said two or three residents had thought the "large dark, metallic low-flying plane" might crash.
"They were a bit concerned, they thought it might be in trouble," said Mr Metcalfe.
A Defence Force spokesman said that the RNZAF was conducting Exercise Skytrain - an annual training of C-130 crews in tactical flying.
"This is week two of a two-week exercise. Skytrain is annual activity that moves around various locations within New Zealand."
The spokesman said it was believed a ground fire was in progress about the time the aircraft flew over, which might explain the reports of smoke, although engine exhaust was sometimes more visible on certain days.