Problem with outgoing emails in Sharepoint Services 3.0

Hi,

  I have a recent install of Sharepoint Services installed on a server at 10.3.78.9, my outgoing email settings in Sharepoint are SMTP Server: WSS-SERVER-NAME  From Address: it@domainname.com (alias email of my primary exchange email account) To Reply-to address: it@domainname.com  Character Set: 65001.   When adding a new user (myself) and having Sharepoint send out a default auto welcome email I receive the following email in my inbox...  

Your message did not reach some or all of the intended recipients.

      Subject:      Welcome to the SharePoint group: Team Site Owners for site: INTRANET
      Sent:      5/20/2009 10:51 AM

The following recipient(s) could not be reached:

     Rockfly on 5/20/2009 10:51 AM
            There was a SMTP communication problem with the recipient's email server.  Please contact your system administrator.
            <PUTNAM-SANDBOX.PUTNAM.LOCAL #5.5.0 smtp;553 The sender is spoofed.>

The SMTP setup is pretty much default from the install.... below is an example log file.
#Software: Microsoft Internet Information Services 6.0
#Version: 1.0
#Date: 2009-05-20 14:51:26
#Fields: time c-ip cs-method cs-uri-stem sc-status
14:51:26 10.3.78.9 HELO - 250
14:51:26 10.3.78.9 MAIL - 250
14:51:26 10.3.78.9 RCPT - 250
14:51:26 10.3.78.9 DATA - 250
14:51:26 10.3.78.9 QUIT - 240
14:51:26 209.214.xxx.xxx  - - 0
14:51:26 209.214.xxx.xxx EHLO - 0
14:51:26 209.214.xxx.xxx - - 0
14:51:26 209.214.xxx.xxx HELO - 0
14:51:26 209.214.xxx.xxx - - 0
14:51:26 209.214.xxx.xxx MAIL - 0
14:51:26 209.214.xxx.xxx - - 0
14:51:26 209.214.xxx.xxx RSET - 0
14:51:26 209.214.xxx.xxx - - 0
14:51:26 209.214.xxx.xxx MAIL - 0

Any ideas?

Thanks!
rockflyAsked:
Who is Participating?
 
Rajith EnchiparambilOffice 365 & Exchange ArchitectCommented:
version of exchange? You need to allow the app to send the email.

http://msexchangeteam.com/archive/2006/12/28/432013.aspx
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rockflyAuthor Commented:
I am on Exchange 2003, reading through the linked article now.  Thanks.
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rockflyAuthor Commented:
Seems to be a one step process in Exchange 2003 and I already had the server 10.3.78.9 setup on the Exchange SMTP Server as allow on relay restrictions.  Anything else I might be missing?
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Rajith EnchiparambilOffice 365 & Exchange ArchitectCommented:
If you have just made the change, you need to restart the SMTP service for the changes to take effect.
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rockflyAuthor Commented:
Was unable to fix based off feedback but thanks for the help.
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