SSRS 2008 SMTP Connections Issues

I've been having some issues with SSRS reports being sent via SMTP and was wondering if anyone had any similar experience with it yet and was able to fix it?

I have about 20 SSRS reports that are generated every morning using using a data-driven subscription and shared schedules. They are based on a clustered SQL 2008 server and sending the SMTP to a remote exchange server on the same network that emails the reports to various emails supplied by the data from a table (holds all details so to, cc, subject, render format etc etc). Each email goes from 1 up to 13 people per message - not massive numbers in the sleightest. A similar process occurs in the evening sending 2 reports to 22 locations.

The reports ran fine and were received successfully each day for about 2 weeks, however we were having an error message occur on the Exchange server (MS Exchange 2007 I believe) warning that the SQL server was hitting the maximum simultaneous connections. The default was 20. As such, we changed the setting however the error messages continued and as such it was increased incrementally to try and accomodate this. We're now at 10,000 and still getting error messages saying it keeps hitting its limit. A side effect of this change is that now we don't receive all our reports despite increasing this setting.

Turning on verbose reporting for SSRS resulted in the following message;
Error sending email. System.Runtime.InteropServices.COMException (0x80040211): The message could not be sent to the SMTP server. The transport error code was 0x800ccc67. The server response was 421 4.3.2 The maximum number of concurrent connections has exceeded a limit, closing transmission channel.

This makes sense with the logs from the exchange server but can someone tell me why SQL server is trying to open 10k+ simultaneous SMTP connections to send only 20 emails? And why only since we changed this from 20 simultaneous connections, that it now doesn't send some of the emails entirely.
I've split the reports out from the original shared schedule to run each report in turn and it seems this has now cured most of the issues but we still get the odd maximum connections error on the Exchange server and an odd email failure.