Most sites should not use the SMTP proxy as it adds additional latency to the SMTP protocol. However, a large-scale site which makes heavy use of SSL to protect SMTP connections may wish to maximize their investment in SSL accelerator hardware by performing all SSL operations for all protocols on a server which does nothing other than SSL and proxy. The SMTP proxy allows SSL to be processed by a front end proxy server while the mail queues are on a separate MTA machine. This way hardware optimized for each task can be separately configured and purchased.
See Using the MMP SMTP Proxy in Sun Java Communications Suite 5 Deployment Planning Guide and 23.8 Enabling POP Before SMTP for instructions on how to install the SMTP Proxy.