mail for domain.com loops back to myself

In the log file:

>Jun 7 12:53:25 kyle postfix/smtp[32234]: E08055DFA3:
>to=<natalie@mailhandlers.com>, relay=none, delay=1, status=bounced (mail
>for mailhandlers.com loops back to myself)

Postconf:
>[aball@kyle aball]$ /usr/sbin/postconf -n
>alias_database = hash:/etc/postfix/aliases
>alias_maps = hash:/etc/postfix/aliases
>body_checks = pcre:/etc/postfix/body_checks.pcre
>body_checks_size_limit = 175000
>command_directory = /usr/sbin
>config_directory = /etc/postfix
>content_filter = smtp-amavis:[127.0.0.1]:10024
>daemon_directory = /usr/libexec/postfix
>debug_peer_level = 2
>disable_vrfy_command = yes
>header_checks =
>regexp:/etc/postfix/block255, pcre:/etc/postfix/header_checks.pcre
>inet_interfaces = all
>local_recipient_maps = proxy:unix:passwd.byname $alias_maps
>mail_owner = postfix
>mailq_path = /usr/bin/mailq.postfix
>manpage_directory = /usr/share/man
>message_size_limit = 20480000
>mime_header_checks = regexp:/etc/postfix/mime_header_checks.regexp
>mydestination = $myhostname, localhost.$mydomain, $mydomain, localhost
>mydomain = acttheatre.org
>myhostname = mail.acttheatre.org
>mynetworks = 192.168.100.0/24, 127.0.0.0/8
>myorigin = $mydomain
>newaliases_path = /usr/bin/newaliases.postfix
>notify_classes = resource,software,bounce,2bounce,delay,policy,prot ocol
>queue_directory = /var/spool/postfix
>queue_minfree = 20480000
>readme_directory = /etc/postfix/README_FILES
>sample_directory = /etc/postfix/samples
>sendmail_path = /usr/sbin/sendmail.postfix
>setgid_group = postdrop
>smtpd_banner = $myhostname ESMTP
>smtpd_helo_required = yes
>smtpd_recipient_restrictions =
>reject_non_fqdn_sender, reject_non_fqdn_recipient,
>reject_unknown_sender_domain, reject_unknown_recipient_domain,
>check_client_access
>hash:/etc/postfix/mynetworks, permit_mynetworks,
>reject_unauth_destination, check_recipient_access
>hash:/etc/postfix/postmaster, check_recipient_access
>hash:/etc/postfix/exceptions, check_sender_access
>hash:/etc/postfix/sender_blacklist, reject_rbl_client
>sbl.spamhaus.org, reject_rbl_client
>cbl.abuseat.org, reject_rbl_client
>relays.ordb.org, reject_rbl_client
>opm.blitzed.org, reject_rbl_client list.dsbl.org,reject_rbl_client
>dul.dnsbl.sorbs.net, reject_unauth_pipelining, permit
>smtpd_restriction_classes = check_for_valid_sender
>soft_bounce = no
>strict_rfc821_envelopes = yes
>unknown_local_recipient_reject_code = 550

Dig on our nameserver reports:
>[actserver:/var/named/act] aball% dig mailhandlers.com mx
>
>; <<>> DiG 8.3 <<>> mailhandlers.com mx
>;; res options: init recurs defnam dnsrch
>;; got answer:
>;; ->>HEADER<<- opcode: QUERY, status: NOERROR, id: 4
>;; flags: qr rd ra; QUERY: 1, ANSWER: 1, AUTHORITY: 2, ADDITIONAL: 3
>;; QUERY SECTION:
>;; mailhandlers.com, type = MX, class = IN
>
>;; ANSWER SECTION:
>mailhandlers.com. 36m25s IN MX 10 localhost.fabulous.com.
>
>;; AUTHORITY SECTION:
>mailhandlers.com. 23h36m25s IN NS ns1.fabulous.com.
>mailhandlers.com. 23h36m25s IN NS ns2.fabulous.com.
>
>;; ADDITIONAL SECTION:
>localhost.fabulous.com. 23h36m25s IN A 127.0.0.1
>ns1.fabulous.com. 1d23h36m25s IN A 64.15.205.211
>ns2.fabulous.com. 1d23h36m25s IN A 64.15.205.212
>
>;; Total query time: 14 msec
>;; FROM: actserver to SERVER: default -- 192.168.100.27
>;; WHEN: Tue Jun 7 13:15:18 2005
>;; MSG SIZE sent: 34 rcvd: 153

And checking offsite traceroutes, I get the same result: the domain
localhost.fabulous.com resolves to 127.0.0.1

Isn't this a DNS problem for mailhandlers.com? Or do I need to take
localhost out of $mydestination?
--
Andrew Ball 700 Union St.
Systems Ringmaster / Seattle, WA 98101
Technology Sherpa (206) 292-7660 x1337 voice
ACT Theatre (206) 292-7670 fax
aball@acttheatre.org