John,
I usually run into the opposite....the e-Smith server handles e-mail but NOT www or ftp.
I get around it by deleting the www and ftp entries in the hosts list, you might delete the mail entry. Then, I explicitly put in new entries for the external servers I need, ie www --> aaa.bbb.ccc.ddd. You could do the same with the mail, perhaps.
Secondly, as mail exhangers lood for MX records, you need to make sure that the name servers list your correct mail server IP address.
Good luck.
Bobby