Based on the facts that the email setting were working after a reboot and the error you are getting is "cannot connect to email server", I think the problem is with your DNS on the server.
I would change the smtp server address to be the ip address of the server and not the host name.
Page 31 in the System Admin Guide explains how to do that (link below)
http://download.support.xerox.com/pub/docs/WC7120/userdocs/any-os/en_GB/sys_admin_guide_en.pdf