Can you assign email (SMTP) notification actions to system health

No, you cannot assign email notification targets to system health packages. Only ODBC (database) notifications can be directly linked to a system health package. Instead, you will have to create one or more event log filters that will look for events generated by the system health feature.

All alerts generated by system health features (e.g. a stopped service, high CPU usage) are logged to the application event logs of the server being monitored. This ensures that you and fellow system administrators can review alerts after they happened.

However, you will need to monitor the application event logs and create one or more filters so that alerts are forwarded to an email or pager for example.

Please see the additional links for more information.