The error you are seeing in the admin panel is not a big deal at all. It is just a notice from smarty about an undefined variable which is a quick way of checking variables. It does not affect functionality or performance at all. If anything it would increase performance.
The mail, you won't get it in your mail / spam folder. Outlook will not deliver it, it will be dropped at the server level. You have to use an email from your domain, or set your domain up to send the emails from outlook. I have not used outlook.com for emails, so I am not sure if that is possible.