hairytea
> In the SME Servers (Review Configuration) page i see that the DNS
> server address is that of the server itself (192.168.1.1)!???!????
That is usually correct for most people.
> If i manually enter my ISP's DNS addresses into my local machines...
You should configure them for auto detect or manually use the same IP as above ie your server.
There was a problem with DNS resolution that was fixed long ago, have you applied all updates for sme6.x eg
e-smith-dnscache-0.3.0-04.noarch.rpm
which has also since been updated to
e-smith-dnscache-0.3.0-04sme02
see
http://forums.contribs.org/index.php?topic=27117.msg119493#msg119493do
yum update
/sbin/e-smith/signal-event post-upgrade
/sbin/e-smith/signal-event reboot