Exchange blocks computers from relaying unwanted e-mail through an SMTP virtual server. By default, all users and computers are blocked from relaying, except those that are able to authenticate....guess, what, EVERYONE can authenticate because SMTP NEEDS ANONYMOUS ACCESS. Everyone can authenticate because by default, ANONYMOUS is allowed for SMTP connection, if you disable this, you won't receive any email because no one will be able to authenticate to your SMTP server to send your domain email. :O
You have to leave Anonymous access on otherwise if you password protect the SMTP connection, then you have to give everyone that wants to send your domain email the password to authenticate to your SMTP server. : )
Obviously, you can't do this. Next, by default, your server:
Exchange = Protocols = SMTP = Default SMTP Server = Relay Properties say : Select which computer may relay through this virtual server: "Only the list below" is default, and by default no one is present, means that no one can relay, right? WRONG. Right below there's a little checkbox that says "Allow all computers which successfully athenticate to RELAY, REGARDLESS OF THE LIST ABOVE!! This single little checkbox effectively bypasses the dissallowed computers/users because this is checked!
Good luck on your Exchange setup, if you're on the West Coast or nearby I can recommend some orgz that specialize in security and Exchange. Furthermore, you can have forensics come in and see who's bouncing email off your servers internally.
Evil Clown.