The smile doesn't reach his eyes. When someone is genuinely smiling, the area around the eyes wrinkle up some (especially the outside corners). Fake smiles don't do that, not without conscious effort. It's so unsettling because it's setting off an instinctual urge of "this guy is being deceptive and is likely a threat". You can check by covering part of the face in the image: cover the mouth, and the eyes just look dead and soulless.