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You've not said, so I'm going to presume that the Mac is running at least Mac OS X 10.4 (update to .9 at least, which is required for Office 2008).
OS X handles ".local" differently than Windows does. Have you added:
in System Preferences > Network > Search Domains field ?
Entourage uses OWA to connect to the server. If you use SSL then you will need to export the certificate,
and use "Microsoft Cert Manager" in Applications/Microsoft Office 2004(or 8)/Office
to import the cert. You might also want to double-click it and add it to the X509anchors for the OS X keychain mechanism.
Then, in the final field of (manual setup) Account Settings tab, "Exchange server"
or if no SSL
Also make sure in the "Advanced" tab to customize your LDAP port if need be,
typically = 389