I am trying to do some emailing out of Axapta at the moment and I found an old post in the development-axapta mailing list that provides a way to check whether you can send mails via SMTP using telnet.
You can take a look at the post here: http://firstname.lastname@example.org/msg09750.html
Another tip: if you have installed McAfee VirusScan, it might block all connections on port 25 on your PC (to avoid mass-mailing viruses using this standard SMTP port). So check it and disable it if you want to use SMTP from your PC.
Development tutorial: SysExtension framework in factory methods where the constructor requires one or more arguments
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