Those are really Pegasus/Mercury questions. The XAMPP Developers only included it as an add-on package.http://community.pmail.com/
BUT, that said - its most likely that you have not configured 'sendmail' its an MTA (Mail transfer Agent) - NOT Mercury (a full blown SMTP server). You should check what the settings are in Drupal for sending mail. Things like location of sendmail, etc. I don't use Drupal, but I do use a variety of other CMS's and forum software - most want to use a local MTA to 'sendmail'. The XAMPP one is found in \XAMPP\sendmail along with samples on how to configure.
For more info: in this forum use Search Forum window and search on configure sendmail, you will find lots of information (including some answers I wrote). or click this: search.php?st=0&sk=t&sd=d&sr=posts&keywords=configure+sendmail&fid
I also suggest you look/ask here: (where you can confirm my suspicion)http://drupal.org/forum/1
AN SMTP server is when you "Serve your own mail" = meaning you run the mail server that is listed in the DNS MX record for your domain. If you don't know what this last thing is/describes, you don't likely need an SMTP server running in your XAMPP server.
BUT, if you really want or need a MAILSERVER then
From my personal experience, hMail is a much better Windows based SMTP/POP server.http://www.hmailserver.com/