Thanks guys for your help...

I have port forwarding working on anything other than SMTP. If I port scan from the internal network port 25 is not open on the router. I can port scan the router externally and see that port 3389 is open for example and this all works fine.

The email server is on the internal network. I have completely disabled all firewalls and even setup a different email server on a different server.

Port 25 is open on the 2 mail servers.

I am completely confused. Why would SMTP be any different?

The external IP of the site at one point was blacklisted because of a mess up with the ISP. If I check the IP address again it is coming up as being black listed with a few sites. Would that affect the telnet to port 25.

Either your ISP is blocking Port 25 traffic (which some do) or secondly, have you checked that none of the Draytek Management ports have been changed to work on a non default (port 25) port. Check that from System Maintenance -> Management.