Or just drop the last part: "sgallagh reported a new issue against the project: 'fesco'. What do you think?

Well, if they aren't otherwise following that project, it might be handy to inform them that it's trying to get their attention.

Also, I'm not sure what the message looks like if they get @mentioned in a later comment. It might be useful to do a simple check on the "subscribers" list and tweak the message to make it clear that their attention was requested.

Could we say something like sgallagh mentioned you in an issue they reported against the project: 'fesco'?

And for mentions in further comments, something like sgallagh mentioned you in a comment on an issue in the project: 'fesco'.

We can have similar messages for pull-requests as well.

Also, this will help us who are with gmail to filter out mentions easily since gmail cant do regex filtering and it thinks " @username" and "username" one and the same since it even doesn't recognize special search characters.

So, can we do something like:
New Issue - <username> mentioned you in an issue they reported against the project: 'fesco'
Comment on an issue - <username> mentioned you in a comment on an issue in the project: 'fesco'
Assigned an issue - <username> assigned you an issue under the project: 'fesco'

But we need to make sure that duplicates are not sent.

I agree that there is a lot of room for improvement in different areas when it comes to email notifications, but for now let's close this issue and other with similar suggestions. There wasn't any progress or updates for years and it's probably more efficient to think about a larger redesign for major release 6 which should be coordinated in a separate issue at a later point.