Relaying denied if contact is part of a group

[cyberal72]

Ok,

I have a strange Entourage 2004 problem.
Recently migrated to Exchange 2003 from hosted email.
Mac user using Exchange 2003 SP2 account.
If Mac user sends to a group containing, let's say 36 contacts, all
but 5 make it to their destination. The 5 other contacts bounce back
with either "Relaying Denied" message, or even "Unable to relay for"
"email address".

Now, having said that, I suspected a relay problem because of the
error message, but even if the user received those error messages, he
was able to send to them individually.

I have checked to make sure there was no recipient limitation on the
Exchange server, and none exist there.
I have googled to see if there was a client side recipient limit, and
I don' see anything useful there.

I would appreciate any feedback anyone can give me.

Thanks,

Al