Received following note from two other Apple consultants:
If you are an SBC/AT&T Yahoo! DSL customer who is having difficulty using Mail.app or Entourage to send messages involving personal or business email accounts not affiliated with an AT&T-owned domain like sbcglobal.net or pacbell.net, you are not alone. The telltale symptom is that messages get stuck in the outbox queue and then go out after several repeated tries.
Without notification to customers, AT&T has implemented an additional form of user identification and verification. The solution is to use the Yahoo! webmail interface to register email addresses for domains other than those owned and operated by AT&T. Afterwards, you should be able to send messages from Mail or Entourage without a problem. The registration limit is 10 mail accounts.
Bottom line is, if you have more than 10 users at a site, don’t use smtp.att.yahoo.com as your outgoing (SMTP) mail server.