Magento 1.62 Customer Notify/Order Status Email not working

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Bids
8
Avg Bid (USD)
$76
Project Budget (USD)
$30 - $250

Project Description:
In the admin section of magento when viewing an order, i add a comment or change a status and the click the "notify customer" box but the customer does not get any email.

New order emails and contact us forms work fine.

I have checked all sales email settings and everything is correct.

Lowest bid wins, it seems this error has been existing from first installation of mangento.

Additional Project Description:
05/14/2012 at 11:05 EDT
SEE ATTACHED DEBUG FILE

Skills required:
Magento, PHP, Software Architecture
Additional Files: debug.png
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