hotmail accounts cannot recieve mails

[petros]

This issue is very strange.

Gmail account for example (and other accounts also) can recieve notification mails
when a customer creates new account or when he confirms the order.
The mail is being sent normally to his inbox.

But...

If a customer create account with a hotmail account (like [email protected]) he
does not recieve any mail!

My temporary test host is byethost and my mail setting is "Use PHP mail() function".

Any idea what could be the problem?

Also i noticed that if i change email settings to "Set my own SMTP parameters. For advanced users ONLY"
nomatter what i enter the mails and the contact form do not work.

And i am sure i am entering the correct parametes.

It seems to me that these settings do not keep the password for the SMTP server when i click Save button!

Is this possible;

Any ideas;

Thank you...