Sorry for yet more noise, but downgrading to exim_3.03-5_i386.deb
fixed the problem. I still think it has something to do with 
the fragmenting as suggested by Wouter, because when I do a 
traceroute -F smtp.student.unsw.edu.au, the last hop fails with 

[snip] 129.654 ms !A *  119.699 ms !A

I'll have to find out through the exim people.

Thanks,
Mark.

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