At one time we had On Prem Exchange and so all users in SharePoint were email-able through SharePoint.
We have since done a migration to Exchange Online. And while SharePoint can still send email to the users who existed at the time, we're seeing that new users since the migration do not get email.
We updated the Outgoing email settings of SharePoint 2007 , so we know routing isn't a problem, but instead something lacking in Active Directory (we presume) that isn't there for the new users that's there for the older users.
FYI: We do manually fill in the ProxyAddress and TargetAddress of the new user objects since we want to use our vanity domain, and we have Active Directory Synchronization in place (but not Single Sign On)
Not sure where this question belongs.