It is patently SIMPLE & CLEAR that R' Moshe is referring to a substance similar to crack cocaine, which at the time of His letter marijuana may have been charactirized as by medical professionals and others. Arguably R' Moshe consulted with someone to determine what substance it was and what effects it has, and was arguably given the false "official classification" of the time, even in good faith.
In light of the present correction of the generally accepted false claims of the time (extreme addiction, brain-cell killing, erosion of mental etc faculties), given that they have been shown to be false, this letter would be cast in doubt as unreliable given the misinformation, even provided in good faith, that it is based on.
Furthermore, R' Moshe refers to Chashish & Marijuana..
Had he been informed that the substance in question, the one and same, is Cannabis [Kanbois in Torah Shebaal Peh, or KNEI BOSEM in Torah Shebichsav {for Shemen Hamishchoh etc}] he arguably would have known IMMEDIATELY that it is certainly not a harbinger of such harm or destruction, and CERTAINLY would NEVER have called it "tumhoh"!!!
In short this is SIMPLY & CLEARLY a case of mistaken identity, exacerbated by, albeit delivered to Him in good faith, misinformation, and clearly associated with the physical withering of crack addicts easily publicly observed at the time.
In closing [citation needed]: Reb Moshe Himself wrote in a Responsum that His rulings are subject to new information and correction, as a rule, in any case where such information or correction is needed and correct. In short: His Responsa are Chochmoh not Ruach haKodesh.
In light of all the above the cited letter of Reb Moshe would be classified as misinformed, erroneous and inapplicable by His own Allowance.
On that note, while one may not be permitted to directly inhale smoke for health reasons, one may burn it in the form of incense, cook with it as a spice, and certainly sell it to adults as a spice, food or medicine.
Lastly, while there remains a federal law, and in some places also state law, against its use, raising the question of dina dimalchusa.. dd"m applies to laws which are not regularly trampled by citizens, e.g. an expired meter even for several minutes and driving a couple mph over the speed limit in safe conditions both would definitely not be an issur of dd"m (whether one gets penalized or not, regardless of arguments that the first may be theft and the second endangerment) because these legal limitations are regularly "trampled" by the masses dd"m wouldn't apply. So too with the consumption of Cannabis which is argualy one of the, if not the, most trampled federal law(s), Dina Dimalchusa Dina would not apply.
As with any substance (coffee/sugar included) if an individual finds it distracts him from Torah Study or Tephiloh he should limit or cease his use thereof, whether cannabis or otherwise, but this would not be the rule, but rather the exception.
Tizku leMitzvos