Part of the difference will depend on what version of Ignition you’re running…
In 7.7.x, you’re probably referring to the set up you can do when you make the email notification profile. This is where you set up the “constant” parts of the alarm notification like the hostname, port, etc.
The Email Settings area in the Gateway (under Configuration) was originally added for the new Reporting module in 7.8.0. This lets you set up (and test) a SMTP server one time, and then use it by name in all your reports, rather than trying to get all the settings right in each report (and having to find them all again when your settings need to change.)
The alarm notifications did not use this central SMTP manager, because it wasn’t available prior to 7.8.0. (In 7.8.1, which will be out soon-ish, we’ve added the option for alarm notifications to use either version). So your are essentially setting up all the same information, but in a totally different place.
Because the Email Settings is newer, we’ve been able to include a little more trouble shooting information, but unfortunately we’re limited to what the SMTP server reports back to us. You’ll see errors for that logged in the Gateway console. I’d suggest getting your profile working there, even though the alarm notification won’t use it yet, just because it’s easy to test and see what’s going wrong. Then you have settings you know work, and you can copy them over to the alarm notification.