Pete Zerger (MOM MVP) and I collaborated on a OpsMgr 2007 Notification How-to Guide.
One of the many enhancements in Operations Manager (SCOM) 2007 is the new notification framework. The new platform offers more flexibility in configuration of notification subscriptions out of the box than was available in the previous version of Operations Manager, as well as several new features. The addition of alert escalation and notification, via Instant Messenger (MS LCS 2005) are just a couple of exciting new offerings in SCOM 2007 notification services. This guide will step through the configuration steps and options for setting up SMTP and IM notification in SCOM 2007.
Read the Guide here.