It very well could be an issue of choosing STARTTLS (If available) instead of STARTTLS.
Admittedly it is odd, but they are not the same in Xerox products, in fact, in almost every case the if available one will fail when the STARTTLS one will succeed.
You may also need a firmware update, the Fuji-Xerox products all (mostly all) had some issues with SHA-2 encryption and had to get firmware updates to resolve issues with any SMTP server using it (Gmail and Office365 are the big ones who do)
If that is the case though, I can't supply it because these machines need a tool to install the updates, and the tool is not available publicly (as far as I know)
So try STARTTLS, and port 587. If it fails, call Xerox, get 2nd level, request Firmware 80.30.71 to fix an issue with email authentication from the IOT