The DNS server encountered a packet addressed to itself on IP address xxx.xxx.xxx.xxx. The packet is for the DNS name "au.download.windowsupdate.com.". The packet will be discarded. This condition usually indicates a configuration error.
Check the following areas for possible self-send configuration errors:
1) Forwarders list. (DNS servers should not forward to themselves).
2) Master lists of secondary zones.
3) Notify lists of primary zones.
4) Delegations of subzones. Must not contain NS record for this DNS server unless subzone is also on this server.
5) Root hints.
Example of self-delegation:
-> This DNS server dns1.example.microsoft.com is the primary for the zone example.microsoft.com.
-> The example.microsoft.com zone contains a delegation of bar.example.microsoft.com to dns1.example.microsoft.com,
(bar.example.microsoft.com NS dns1.example.microsoft.com)
-> BUT the bar.example.microsoft.com zone is NOT on this server.
Note, you should make this delegation check (with nslookup or DNS manager) both on this DNS server and on the server(s) you delegated the subzone to. It is possible that the delegation was done correctly, but that the primary DNS for the subzone, has any incorrect NS record pointing back at this server. If this incorrect NS record is cached at this server, then the self-send could result. If found, the subzone DNS server admin should remove the offending NS record.
You can use the DNS server debug logging facility to track down the cause of this problem.
In this case "Root Hints" was pointing to the machine's own FQDN. We removed that entry from the list, then hit the "Copy from Server" and entered the external DNS server IP. This pulled all the root servers into the list.