Monsters sure, could have some creatures come exploring, or burrowing into it. In this location I think smugglers are not likely, and what would they be doing? its a small town, and a small tunnel, with some small chambers for storage and such.
So far, I just sent them on another adventure, with a were badger and his dire badger friend, and a small family of reg badgers. If they help the were badger they will have a ally who will build the structure for them, if they kill him, they will probably tame his badgers. though will lose the dire badger to its rage over death of his friend tarn.
Honestly I hope they save the guy, I can hand them graph paper. have them design their lair, then just hand wave the npc building it a bit more each day. presumably with skill, and with miner kobold assistance. should be no sweat.
And I have enough of an idea now of timing to make it work, which ever way they go.
Thank you, all for your thoughts. My players are going to "dig having a secret lair"