DNS pointing to Loop back?

I have a network that I am looking at.  All of the client PCs are set to the loop back address of for DNS
The Server lives at and its a SBS server from Microsoft 2011.  

Is there something I am missing.  why would the works stations all be set to this loop back statically.  
Isnt this wrong? Can someone chime and tell me I'm crazy and its ok to use the loop back as the primary DNS instead of having my clients point to the DC where DNS is running and  so is DHCP

I would expect the DHCP options to give all workstations
JohnnyIT Consultant!Asked:
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Kyle AbrahamsSenior .Net DeveloperCommented:

It might be the server is incorrectly figured.

Wouldn't make sense to refer to itself as a DNS server.
client computers don't run dns server service

you need to set correct dns may be with dhcp
David SankovskySenior SysAdminCommented:
I assume the person who configured the SBS got confused.

In essence, a DNS server usually refers to iteself when performing lookups (I.E the DNS seerver address on the server holding the DNS role is usually set as and the domain has a forwarder set up to allow for external queries).

It's logical to assume that since this is an SBS server, it holds the DNS role, and I'm guessing that in your scenario that server also holds the DHCP role.

Check the DHCP server settings, You'll most likely find the DHCP server sets the DNS server address as to the stations.

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JohnnyIT Consultant!Author Commented:
What if IPv6 in this environ.  If this is set and working will it take precedence and keep the domain health?
David SankovskySenior SysAdminCommented:
If that were the case you would've seen the DNS set as ::1 rather than 127.0.01
JohnnyIT Consultant!Author Commented:
OK, I've been building networks for a very long time. 27 years. I know DNs, I know dhcp, I just know active directory. The pcs in this domain all have exclaimtion points over their net icons.  They all have functioning DNs on the server set to with forwarders set to and  All  lines are pointing to 127.0.o.1 and these are all static. How is this happening.  I'll look at lmhost.  I'm not on site I'm in Pittsburgh network in california
Jose Gabriel Ortega CastroCEO Faru Bonon IT - EE Solution ExpertCommented:
Well, it should be pretty clear.

1st step is to check the DHCP of your network (and check if you have 2 DHCPs in your network) should be just 1.
2nd step is to check the DHCP options, to make sure that your DNS in the DHCP is correct (or set the option accordingly).
3rd Step if it's on a server make sure that is "authorized in the AD".
and it should just give the internal DNS of your domain controllers.

you should not have any public DNS in your internal DNS settings.
That's what forwarder is made for, I think you got it correctly.
JohnnyIT Consultant!Author Commented:
Thanks for the answer.  I dumbed things down as I was deeply perplexed.  When each work station has a DNs set ststically to the loopback space of 127.x.x.x, and my clients Sbs server lives at, and yet resolution of DNs internally and externally works as designed, well, I tend to get knocked upside down.  To complicate things I'm in Pittsburgh, and the client is in souther California.  I'm accessing through connectwise, which I love the pricing and the capabilities over top of TeamViewer, but that's another matter. Anyway, I'm accessing the server and one workstation  remotely. My goal is simple. The client uses office 365 with exchange, and over the past few months their public folders which they use as an ERP have ground to a  crawl. WHY!!?? Then I have yellow exclamation points over all network icons in the far right of the systray.  Add also that when I hover over this error condition it claims no internet access.  Yet, everything seems to resolve, but 365 public folders wither on vine.  Now I know that public folders aren't meant to be used like the clients has been, but I do know it's done like this all the time anyway.  Further, those folders should process a 8 meg email, and even larger in under 20 minutes.  I beat my head against the wall as I studied their problem, and over the course of yesterday I learned much about the history, and then suddenly I found the problem. We will be doing further testing today, but things seem to be working well with my prototype workstation, and the issue was the great and powerful technical consulting company's monitoring software.  They chested my client to the tune of 10s of thousands.  Their software made the network die.  Those dirty dogs.  Nothing I hate more than arrogant IT people unless I find arrogant IT people ripping off the client.  Anyway, one bloody nose for the big consulting company and one nice win for the little guy, me.  I'll close this ticket out soon. Thanks for your help.
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