You can use the genericstable to re-write local addresses, both "From:" addresses and envelope addresses, to anything you choose. First, make the needed changes to your sendmail.mc:
FEATURE(genericstable, hash /etc/mail/genericstable)
Then, from the location in your sendmail source tree that has both the sendmail.mc and a copy of the "Build" script, do a "./Build sendmail.cf". That will build a valid sendmail.cf, which you can drop into /etc/mail. Make sure to back up your original /etc/mail/sendmail.cf first. Next, build the /etc/mail/genericstable. It will have entries like this:
Do the following to create the keyed database with the M4 macro processor:
makemap hash /etc/mail/genericstable.db < /etc/mail/genericstable
You have to restart sendmail now. Not so that it can read genericstable.db, but to get it to re-read sendmail.cf.
Do something that causes system messages to be generated. Your sender address and envelope address should be masqueraded to the same address.