I would check the email addresses in the email that is sitting in the Outbox. Sometimes if there is an invalid email address Outlook will not send the email at all and it will sit in the Outbox as described.
Thanks for your help. I looked at the email addresses this morning - all internal, with a mixture of single and distribution groups. One of the groups had as members, 2 other groups. So I used the "sub-groups" instead of the "parent group" and it worked in test. It's a bit of an anomoly as this "parent group" works in all (non CRD) applications.