Steve Smith provides an excellent article on configuring Email Enabled Libraries in MOSS 2007 using Exchange 2003: http://www.combined-knowledge.com/Downloads/Moss07incoming_e-mail.pdf

Configure SMTP for MOSS on Windows Server 2008

To configure SMTP for MOSS on Windows Server 2008 do the following:

Windows Server 2008 Configuration

1. Add the SMTP Server Feature if required.
2. Specify an E-mail address
3. Use the 'Deliver e-mail to SMTP server' option
4. Set SMTP Server to your Exchange server
5. Click Apply

MOSS Configuration

1. Central Administration -> Operations -> Incoming E-Mail Settings
2. Enable sites on the server to receive e-mail
3. Settings mode: Automatic
4. SharePoint Directory Management Server: No
5. E-mail server display address: Accept default
6. Accept mail from all e-mail servers.

Email is written to various C:\Inetpub\mailroot\ folders during the life of an email transmission. You may be able to use these folders for troubleshooting.