Gatsu Even if you do not use this extension, and a user enables email notifications manually for mentions/replies, the PrettyMail templates for those actions would still be used.. this extension just enables those notifications for users by default in their preferences.
So yes it does work with, but they are not related. One changes default notification behaviour for a user for replies and mentions, the other is used for email notification templates. PrettyMail is restricted to a few different types of email templates (default, subscription/new post, mentioned user, mentioned post).