nUnrouteable address

here are my email configurations in settings.py

EMAIL_BACKEND = 'django.core.mail.backends.smtp.EmailBackend'
EMAIL_HOST = 'smtp.domain.org'
EMAIL_HOST_PASSWORD = 'password'
EMAIL_HOST_USER = 'webmaster@domain.org'
EMAIL_PORT = '587'
DEFAULT_FROM_EMAIL = 'webmaster@domain.org'
SERVER_EMAIL = 'webmaster@domain.org'
# EMAIL_USE_TLS = 'True'
EMAIL_SUBJECT_PREFIX = '[domain correspondance]'

here is the output of tests from the command line.

(mysite)mark@longsox:~/domain$ python manage.py retry_deferred
8 message(s) retried

(mysite)mark@longsox:~/domain$ python manage.py send_mail
------------------------------------------------------------------------
acquiring lock...
acquired.
sending message 'Confirm e-mail address for domain.org' to
mark@emailaddrs.net
message deferred due to failure: (550, 'Verification failed for
<webmaster@localhost>\nUnrouteable address\nSender verify failed',
'webmaster@localhost')

so basically pinax is not sending verification emails

this pinax site is running on django 1.2 and the server ubuntu 10.04
nginx fastcgi

do I need to add the smtp server to the /etc/hosts file?

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