This does not take into account the reliability of SQL Mail. I have had enormous amounts of trouble with SQL Mail and I highly recommend that it not be used for applications. It is fairly stable if you're just sending alerts from SQL Server and SQL Agent but relying on it for business needs is not a good idea.

Ok... now I'm beginning to worry:

Alarm messages filter into a public folder on our Exchange server, and these need to get into SQL somehow.

I was going to write a stored procedure that did the xp_OpenMail, insert into foo from selectunread, xp_CloseMail bit, but if sqlmail's reputation holds true, it sounds like I'm in trouble

Any suggestions?

(I do like your suggestion for using MSMQ for reliable msg delivery and will use it when we get around to the notification part of the project)