> > 554 8BIT SMTP extension not supported
 
Clearly, that is a complaint about unprintable characters.  It comes from
the gateway in question and is beyond the control of LISTSERV.  Sounds
like a new "feature" designed to force people to use MIME.
 
> The last line of the messages contain non printable characters
> along with the contents of the Subject: line.
 
Sounds like the trailing subject on a PROFS note.  If so, the problem
is presumably in the translator that converted the PROFS note into
RFC822 mail.  It should strip out the trailing subject and leave only
the one in the mail header.
                                     John