I've heard this, but I've never understood the idea. In fact, the (i) is pronounced so shortly that one's mouth has no time to take the look of smiling, especially for a typical Finn who doesn't much move his/her mouth when speaking.Finnish: sano "muikku"! (say "vendace"!)
Hey, we also say that in Catalan to make children look at the camera, mireu al pardalet! or mireu, que ix el pardalet!.In Omniglot.com there is a Czech phrase "Vyletí ptáček!" (or "Pozor, vyletí ptáček").
It means "(attention,) a birdie will fly out".
Just wondering: don't those languages using words generally refer to words containing the sound /i:/? I thought for a second it forces people to close their mouth, which is a condition for smiles. Crazy?