You could try http://drupal.org/project/commerce_email

I'm not even sure how you got the ordered items listed at all. I just get product numbers.

I'm having similar issue. I was able to get the email template to send out all sorts of things but the actual product details look HORRIBLE. The values are all smashed together and I don't see how I can get them to look better. No slice and dice I guess. Can ANYONE elaborate on how to cycle through line products and show the detail in an easy to read way? Randy Faye's video is helpful but not exactly what I'm looking for. any help appreciated.

I installed the Commerce Email module as suggested elsewhere and then hacked the module, which is where the styling for the default email comes from. It's a bit limited though, and obviously not an ideal approach.....