Yes, it is used in OpenACS. The problem you are having is that (as the error messages states), your machine can not connect to localhost (127.0.0.1) port 25.
Do you have a mail server running on the server?
netstat -na | grep 25
Can you telnet to localhost, port 25
telnet localhost 25
You might have to change the settings in the your conifg file to point to a working mail server on your network:
ns_param mailhost smtp.yourcompany.com ;# SMTP host for ns_sendmail
