Thanks to Lunarpages Customer Support Representative
McDan for finding this issue and a very simple fix:
There appears to be an issue with the latest Mail program that comes with OS X Snow Leopard. If you leave the SMTP port to the default setting, which is to auto-detect the port, it has a high chance of failing. You will need to click the radio button to manually select the port and enter it there.
Go to Preferences > Accounts, select your account, then click on the popup menu next to "Outgoing Mail Server (SMTP)" and pick "Edit server list". Then pick the SMTP server you are using, then click on Advanced, and apply the "Use custom port" setting. Also got it posted to the wiki here:
http://wiki.lunarpages.com/Mail_in_Mac_OS_X#Snow_Leopard_OS_X_Mail_Problem 
