Help! DNS problem (I think)

Please help me to resolve what I hope is a simple problem.
After a lot of searching I have been unable to find a solution to a mail problem I have been struggling with for a few days now that appears to be DNS related.

Running Mac OS X Server (10.3.5 combo update). Erased HD before installing Server OS.
DNS was the first thing I configured as this is to be the mail server, mail.mydomain.com.au. Forward and reverse lookups look right.

Firstly, do I need an MX record or not? The MX record is hosted by my ISP and all mail is directed to my static IP.

How do I solve the following problem –
Have set up Apple Mail on server and client machines. Appear to be able to check mailboxes but can’t send successfully.
Mail leaves the Outbox with a satisfying ‘whoosh’ but never arrives at the inbox of the recipient and no bounce is received. The SMTP log shows a name service error:
—
Sep 22 00:37:26 mail postfix/qmgr[2403]: BF0311245C: from=<>, size=2289, nrcpt=1 (queue active)
Sep 22 00:37:26 mail postfix/smtp[2422]: BF0311245C: to=, relay=none, delay=0, status=bounced (Name service error for name=mydomain.com.au type=A: Host found but no data record of requested type)
Sep 22 00:37:31 mail postfix/smtpd[2418]: disconnect from mail.mydomain.com.au[192.168.0.2]
Sep 22 00:41:28 localhost postfix/master[326]: daemon started — version 2.0.10
—

“no data record of requested type” – what type of data record is this referring to??
My DNS setup is very simple. One zone entry and an A record:
Zone Name: mydomain.com.au.
Type: Master
SOA: mail.mydomain.com.au.
Admin email: admin.mydomain.com.au.

Address (A)
Map from: mail.mydomain.com.au.
Map to: 192.168.0.2
Create reverse mapping record is ticked.

Any help would be greatly appreciated.