The SNDSMTPEMM command is indeed limited to 400 characters in the message body, according to the documentation.
Where I work, we still mainly use MMAIL, which used to be free but now requires a $50 "donation" (and lots of hoops to jump through just to register). It doesn't have that message length limitation. It comes with several commands for ease of use, and a service program for more fine-grained control over how the message is built. Once you download it, you have access to the source, so you can really muck around with it if you have to. (The donation also allows you to download a multitude of other utilities from Easy400.net.)
A better but more expensive option is Bradley Stone's MAILTOOL. It's still competitively priced, as far as commercial IBM midrange software goes. If you go that route, it's probably worth getting the Plus! add-on, which side-steps IBM's native SMTP, a recurring source of headaches. (MMAIL and the basic MAILTOOL rely on native SMTP.)
The best place for this kind of post, at least for now, is the Midrange-L mailing list at midrange.com. When it comes to AS/400, iSeries, and IBM i stuff, that community is currently much more active than Stack Overflow, and they welcome open-ended discussion and "what do you recommend?" posts, which are discouraged here. You can find some discussion on the command you mentioned, and some alternatives, in this thread.