Hello,

Try this, 
1st, To resolve the Email Configuration Error,

• Go to Settings > Users & Companies > Users.
• Select your user account and ensure the "Email" field contains a valid email address (e.g., yourname@yourcompany.com).
• Save the changes.
• Once the email server is configured, test it by sending a test email from Settings > Technical > Email > Outgoing Mail Servers (if accessible). This should eliminate the email error when processing returns.

Next, Process the Return of Goods,

• Open your PO (e.g., P00004) from Purchase > Purchase Orders.
• Click the "Receipts" smart button to view the related receipt document (it might be labeled something like "WH/IN/000XX").
• In the receipt, click the "Return" button.
• Specify the quantities to return (e.g., return all items if you want to cancel the entire PO).
• Validate the return by clicking "Apply."
• This creates a reverse transfer, removing the goods from your inventory and updating the PO.

Next, Cancel the Purchase Order,

• Return to your PO (e.g., P00004) in Purchase > Purchase Orders.
• Click the "Cancel" button.
• Confirm the cancellation.

If the return was processed correctly, Odoo should allow the cancellation without the original error. The PO status will update to "Cancelled."

This happens because Odoo enforces this process to maintain accurate inventory and financial records. Canceling a PO with received goods without reversing the receipt could lead to stock discrepancies. The email error is a separate configuration issue that affects workflows involving notifications, like returns.

By fixing the email setup and processing the return, you’ll clear both hurdles and cancel your PO successfully.

Hope this helps.