Magento – How to setup magento admin to send email to customer when order is cancelled

Best practice is to use Magento's event system.

app/etc/modules/Your_Module.xml

<?xml version="1.0" encoding="UTF-8"?>
<config>
    <modules>
        <Your_Module>
            <active>true</active>
            <codePool>local</codePool>
        </Your_Module>
    </modules>
</config>

app/core/local/Your/Module/etc/config.xml

<?xml version="1.0" encoding="UTF-8"?>
<config>
    <global>
        <models>
            <your_module>
                <class>Your_Module_Model</class>
            </your_module>
        </models>
    </global>
    <frontend>
        <events>
            <customer_save_after>
                <observers>
                    <your_module>
                        <type>model</type>
                        <class>your_module/observer</class>
                        <method>customerSaveAfter</method>
                    </your_module>
                </observers>
            </customer_save_after>
        </events>
    </frontend>
</config>

app/code/local/Your/Module/Model/Observer.php

<?php

class Your_Module_Model_Observer
{
    public function customerSaveAfter(Varien_Event_Observer $o)
    {
        //Array of customer data
        $customerData = $o->getCustomer()->getData();

        //email address from System > Configuration > Contacts
        $contactEmail = Mage::getStoreConfig('contacts/email/recipient_email');

        //Mail sending logic here.
        /*
           EDIT: AlphaCentauri reminded me - Forgot to mention that
           you will want to test that the object is new. I **think**
           that you can do something like:
        */
        if (!$o->getCustomer()->getOrigData()) {
            //customer is new, otherwise it's an edit 
        }
    }
}

EDIT: Note the edit in the code - as AlphaCentauri pointed out, the customer_save_after event is fired for both inserts and updates. The _origData conditional logic should allow you to incorporate his mailing logic. _origData will be null.

Just been looking into this myself. I've followed the code and functions back to this function "public function sendNewOrderEmail()" in:

app/code/core/Mage/Sales/Model/Order.php

starting at line 1270 is the following code:

$emailSentAttributeValue = $this->load($this->getId())->getData('email_sent');
    $this->setEmailSent((bool)$emailSentAttributeValue);
    if ($this->getEmailSent()) {
        return $this;
    }

This is checking the sales_flat_order db table to see if the email has already been sent to the customer and if so just to return, but this does not send the email and should throw an error. So I would say it is a bug somewhere. To fix it so you can resend order/invoice emails etc..

Copy

app/code/core/Mage/Sales/Model/Order.php

to

app/code/local/Mage/Sales/Model/Order.php

and comment out line 1273

if ($this->getEmailSent()) {
            //return $this;
        }

Works a charm for me. But literally only this second tested it.

Tested using ver. 1.8.1