I have version 7 and it is in the phoneorder.aspx.cs file, look for the createcustomer_click routine.
Code:
AppLogic.SendMail(AppLogic.AppConfig("StoreName") + " - " + AppLogic.GetString("cst_account_process.aspx.1", ThisCustomer.SkinID, ThisCustomer.LocaleSetting), AppLogic.RunXmlPackage("notification.lostpassword.xml.config", null, ThisCustomer, ThisCustomer.SkinID, "", "thiscustomerid=" + m_CustomerID.ToString() + "&newpwd=" + p.ClearPassword.Replace("<", "<").Replace(">", ">").Replace("\"", """).Replace("'", "'").Replace("&", "&"), false, false), true, AppLogic.AppConfig("MailMe_FromAddress"), AppLogic.AppConfig("MailMe_FromName"), EMail.Text.ToLowerInvariant().Trim(), EMail.Text.ToLowerInvariant().Trim(), "", "", AppLogic.MailServer());
Just comment this out.