I have Xerox Colorqube 9303 software-(061.180.221.31500) and it fails to scan to email using smtp authentication,but the Xerox WC7665,WC7228 and WC7120 works fine with the same ip range and the same email server setup.
It might be that you have all configured correctly, just like other devices but for this one might be some setting it does not like it. Therefore I believe more details are required. Some general questions just to show us the picture you are in to.
Do you have the hability to disable authentication and try scanning with the exact same settings?
Are all LDAP searches working correctly? (this might not affect smtp auth directly)
What smtp server are you using?