Universal Email would certainly give you more options, but you should still be able to set the action to your cgi formmail (assuming that you are sending it from a page on your remote server).
When I was testing out your original script, it did send successfully to your script, and the only message was a formmail warning that i was unauthorised to access the cgi on your server. Should work fine for you.
Also, you shouldn't have any problem with SSV in the future if you leave the action page blank while you are creating the form. You can also apply server-side validation to form-fields from the insert > webassist > CSSFormBuilder > Server Validation menu. (Captcha is a bit tricky though, -to me!).
