Brian,
I haven't checkout why, but a year or so ago, when I first tried playing with the fetchmail.rc, I did exactly the same thing... it fetched the mail perfectly, but delivery failed silently on my server (I guessed this was a "bounce going nowhere" problem, so failure was completely silent).
Another problem I think I had (which sounds silly in hindsight), one of the users I had created (without using the nice interface) didn't have a home directory and so couldn't recieve mail. It wasn't until I had a good look at the failure reported by my email client that I realised what I had done. I now have fetchmail pulling mail from several ISPs, and dot-forwarding to several users, so each has their own copy. The main reason for this is so that each person doesn't have to leave mail on server for others to get a copy, which slows things down once the queue gets big.
What I did to solve my fetchmail dilema, was to use the web interface to get fetchmail retrieving mail from one ISP perfectly. E-smith creates a script called "fetchmail" in the etc directory. At first I went into this script with vi and copied their lines for all other mail I wanted to collect. Once I got it right, I then hacked this into their templates, so that it would stay there (be re-written) when ever I changed other settings (nothing so frustrating as hacking the files in the etc directory and then having them over-written if you change something else with the console or web interface).
The bottom line is that I never got the fetchmail.rc to work. I guess it means the system is running fetchmail, rather than whoever you set the cron job to run as (maybe there is more to it than this, but I got it to work without a minute to spare)!!
As ever, with no intention to insult, always to a check with your email client set to "leave mail on server" before you play with fetchmail. This is for anyone else reading this, because you, Brian have experienced the wrath of silent delivery failure this can cause. I lost some important email because of this, even when I was playing with other parts of the server, like the mail server, because fetchmail just keeps on fetching, whether it can deliver locally or not! Another thing that should be obvious... (but I've forgotten to do sometimes)... Always comment out your fetchmail script before you stop your mail server!
If you want any more help, give me a yell, although I can't promise to jump right to replying that day... but I'll try to help if I can. I haven't copied my file here to public display, but if you email me, I'll edit it down a bit, and send you an example of the fetchmail script (I should also try to remember which template I hacked as well if you want me to).
Gary Williams