When you add a web site, you add one at the top level. Virtual directories can only be accessed by using machinename/VirtualDirectoryName or localhost/VirtualDirectoryName. So while they are similar in that they can contain an application, they are not the same.
I asked it before, but maybe you haven't seen my replies: can you please start a new thread for a new topic? It's much easier for everyone to have separate threads about IIS / Virtual directories and SMTP.
To learn how to install an SMTP server, check out the IIS site: http://learn.iis.net/page.aspx/751/c...mail-in-iis-7/
Alternatively, skip the SMTP server and use a local drop folder as explained on page 318.