I have an exchange 2003 without problems, but after installing a brand new exchange 2010 in the same forest Im getting those errors:
A non-delivery report with a status code of 5.3.5 was generated for recipient rfc822;User@domain.com (Message-ID <DAAEA583454F0145AE3D3CD522D9293703E8E40C@AFG-NET-EXC.riyadh.afg.com>).
Causes: A looping condition was detected. (The server is configured to route mail back to itself). If you have multiple SMTP Virtual Servers configured on your Exchange server, make sure they are defined by a unique incoming port and that the outgoing SMTP port configuration is valid to avoid looping between local virtual servers.