If, in Board Features:
Allow subscribing to topics is OFF, and
Allow subscribing to forums is ON, and
in E-mail Settings:
Allow board-wide e-mails is ENABLED

Then:
No nofications are sent to users subscribed to the forum.

Note that setting "Allow subscribing to topics" to ON fixes the problem, but this isn't what is wanted.

SOLUTION:
The offending code appears to be in includes/functions_posting.php in the function user_notification(). Removing the following lines in that function fixes the problem:

if (!$config['allow_topic_notify'])

Thanks for all you work on this great piece of software!