I am running BuddyPress 1.2.6 with this version 2.7.9 of this plugin. I implemented the code change per http://trac.buddypress.org/changeset/3375/ to fix the problem with the email options not displaying for users in BP 1.2.6. That seems to have done the trick.
However, our emails are still not working. I am set to receive ALL Emails for my groups. The other plugins I am using are WP-Invites, BuddyPress Private Community, cforms, Exclude Pages from Navigation, and All in One SEO. I wonder if any of these plugins might conflict with this one or if this plugin just isn't working with BuddyPress 1.2.6 and WordPress 3.0.2.
So far none of our emails are working, and going to the ?sum=1 page shows no emails in the queue.