Solaris

Here it is. gran.netsource.ie, which I suppose is yout ISP's MTA, is not accepting mails from root@servername.domain. That's correct. You have to "rewrite" it to a something that gran.netsource.ie accepts. Or, if you prefer, map users . I've found this website, that may be interesting for you:
http://www.leg.uct.ac.za/Articles/sendmail_dialup.html
Regards.

Okay, I seem to be making progress now.

I tested sendmail with the following command:

/usr/lib/sendmail -f myaddress@domain.ie myaddress@domain.ie < test.txt

And low and behold I got the e-mail through to outlook on my PC.

Now I've been looking at trying to masquerade the host name so instead of it sending from root@servername.domain trying to get it to masquerade as domain.ie.

To do this I added the following line to the /etc/mail/sendmail.cf file:

# Who I masquerade as ( null for no masquerading) (see also $=M)
DMdomain.ie

I added it because it wasn't there.

Sendmail seems to be ignoring the DM directive, any ideas?

Plus I have been editing the config files directly i.e. not using the M4 macro, does this make me mental?

Remember that you have also to map usernames in case they're not the same (local/remote), which I think is your case (root != myaddress). On the link I posted before it's explained.