Based on your kernel version number, you seem to be running RHEL 6.3.
Any changes to sendmail.mc will only take effect if both these conditions are true:
- the sendmail-cf package is installed, and
- you have run "make" in /etc/mail directory after editing sendmail.mc
This is because sendmail.mc is not actually used by sendmail directly: instead, it is used by the m4 macro processor to create a new sendmail.cf, using bits and pieces of configuration provided by the sendmail-cf package.
The "standard" way to create a new sendmail.cf is to run something like "m4 sendmail.mc > sendmail.cf" in the directory that contains the contents of the sendmail-cf package, but RedHat has made this easier for you. Running "make" in /etc/mail will do the right thing automatically.
(If you have previously edited sendmail.cf directly, it is better to move all your customizations to sendmail.mc instead. Your old modified sendmail.cf will be renamed to sendmail.cf.bak, so you can compare it to the new one to see the differences.)
This page from sendmail.org has the steps for configuring authentication for Sendmail:
http://www.sendmail.org/~ca/email/auth.html
Please look at the chapter titled "Using sendmail as a client with AUTH".
Note that in step 6 you should use the RedHat specific procedure instead of standard sendmail.org procedure:
6. Generate sendmail.cf: # cd /etc/mail # make