This function in the server-manager doesn't do redirect itself. It creates/updates "hosts" file and local DNS server (on the server itself). In addition it makes DHCP reservations for static-like IP assigments to DHCP clients.
If your internal workstation is using Server as a DNS provider, modifications in the host names and addresses will work, but for external users, who use their own DNS servers it will not.
To redirect webpage to another server you need "proxypass" module for apache, available as contribution for SME server. The one updated in april by Abe Loveless works great on SME 5.6, but needs to be tested on SME 6.x