You did run and configure the with checksetup.pl perl script? I had to do it several times to have it complete the install. The process kept getting killed because it was using a lot of CPU on the server.
Administration -> Email ->
mail_delivery_method Set to Sendmail
mailfrom Mail from account address (I'm using same as the account that sends)
smtpserver Enter your email server (I'm using google m.google.com)
smtp_username Enter email account that you want the system to use.
smtp_password Account password