Support for this device appears to have been added to the mainline Linux kernel as of the latest iMX6 kernel. Simply add CONFIG_USB_NET_SMSC95XX=y or CONFIG_USB_NET_SMSC95XX=m to the kernel config.
I am a bit new to building and modifying the yocto project. After I have added the SMSC LAN95xx to the Device Driver, how do i repackage the image and the dtb files back as a tarball? Is there a webinar or a tech note that you could direct me to.
You can rebuild just the kernel/modules in a traditional manner as described above. This is perhaps a little better for a quick-turn development workflow. Once you build the kernel, you can simply copy the uImage and replace the uImage file on the SD card you used to flash the module. Then you can use the update commands to flash the lastest kernel (noteably run update_kernel). You will also need to deploy the kernel modules to the rootfs - this is already described in the article.
Or you can incorporate the changes into the kernel recipe used by our Yocto/OpenEmbedded build system. This build system would allow you to build individual components such as the kernel, bootloader or software packages as well as rebuild the entire image. This is the ideal long-term approach in terms of maintainability & reproducibility. In addition to the documentation provided on our developer website, we also have a 2-part webinar that provides an introduction to the Yocto project and a real-life example of customizing an image including the kernel: