From your description it sounds as if the clutch is worn right down to the rivets. The burning smell will be the remainder of the friction material burning as the clutch slips, and the squealing noise will be the clutch plate rivets scoring horrible grooves in your flywheel.
You need to get the clutch replaced with a new one right away, otherwise you will need a new flywheel as well, and they are expensive.
ChicksFan
October 2011