I agree, it is ususual for an SMTP server to check the validity of the reverse-path address, because mailers could just use a invalid address on a valid domain, e.g. bogusaddress@hotmail.com. The address in the "MAIL FROM:" command gives the reverse path to communicate errors and can be different from the actual sender address.
In any case, this is quite irrelevant for the current discussion, because address verification has nothing to do with relaying.
The error message:
550 5.7.1 Unable to relay for test@bellsouth.netis completely unrelated to your:
450 Unable to find nowhere.comJust to clarify, I was talking about address in the
FROM: field of the message header, and not what is
communicated in the "MAIL FROM:" SMTP command. (Similarly, the TO: field in the header is not used for message targeting and can be anything, it can even be missing and the SMTP server still does not care. Targeting is done entirely with the
RCPT TO: SMTP command which not contained in the header (the mail header is part of the message DATA). Refer to RFC 821 for further details.
You probably won't find a legitimate SMTP server that allows relaying, so the solution is to use the designated SMTP server for the particular location.