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I myself have not yet found a good reason or benefit of using smtpmail and smtpauth with my XOOPS installation. I have conducted a search here and on the web and have not yet turned up any relevant information which causes me to want to use that feature. IMHO
I suppose there is a logical reason or it wouldn't be added to the mail setup features and if someone could shed some light on this I would appreciate it very much.
Using the PHP mail() works great so I do as it suggest in the Documentation Sites-Xoops Operation Guide and use the recommended method. PHP mail(). If that didn't work then I would probably go to the sendmail method.
Best of luck!
Quest