Hello, what driver are you using? If you are using PCL 6, try using PCL 5. Also, have you tried setting the paperhandling setting on the machine, as well as, on the driver? As for the envelope feeder I would try using it on another like model and see if it is the feeder itself, or could be the printer is not picking it up, which could be resolved with a firmware update(best case), if not may just be defective and if under warrenty I would have HP replace it.
Hope this helps.....
