Ok last thing i disocverd about this problem was that I was not only unable to do mail() from PHP but any other socket connection was not succesiful. It worked fine when i start php.exe in shell (command line) but the same script would not connect to anything (even localhost) if run by IIS4. i tryed new version of php (4.1.1 instead of old 4.0.2) and the problem was persistant. My guess is that there was a problem with IIS4 or WinNT Server and how they setup envirnment for php.exe. I copied the website and scripts to an IIS5 server (Win 2k) and there I dont have a problem.
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