err IS rather self-explaitory. IIS cannot get an IP address for the mail server you specified from DNS service.
1)sure that you have no typing errors?
2)sure the IIS server can communicate with DNS server?
3)sure DNS record exists for specified mail host on the DNS server that IIS is trying to reach?
4)proxy issue in browser/VS?
5)try adding.... ?
<defaultProxy enabled="true" useDefaultCredentials="true">