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When I first implemented notifications in a module I was writing, I foudn it useful to insert debug statements (i.e. echo and/or var_dump) into the core code that handles notifications.
For example:
kernel/notification.php
function triggerEvent ($category, $item_id, $event, $extra_tags=array(), $user_list=array(), $module_id=null, $omit_user_id=null)
{
[color=ff0000]var_dump('triggerEvent/start', 'category', $category, 'item_id', $item_id, 'event', $event, 'extra_tags', $extra_tags, 'user_list', $user_list, 'module_id', $module_id, 'omit_user_id', $omit_user_id);[/color]
function notifyUser($template_dir, $template, $subject, $tags)
{
[color=ff0000]var_dump('notifyUser/start', 'template_dir', $template_dir, 'template', $template, 'subject', $subject, 'tags', $tags);[/color]
Those are only examples. You may need to add additional statements to isolate the problem.