Hi Darren,
As I understand, it works fine when you send email via Exchange online, so it shouldn't be the issue of Office365. Based on current situation, I have some suggestions for you:
1. Please send email from Outlook to your Hotmail account to check if it works.
2. Please configure Outlook to connect Exchange online via exchange mode to check if the issue still persists.
http://help.outlook.com/en-us/140/dd253202.aspx
In addition, OWA and Exchange online are same thing.
Thanks,
Aaron Yuan
As I understand, it works fine when you send email via Exchange online, so it shouldn't be the issue of Office365. Based on current situation, I have some suggestions for you:
1. Please send email from Outlook to your Hotmail account to check if it works.
2. Please configure Outlook to connect Exchange online via exchange mode to check if the issue still persists.
http://help.outlook.com/en-us/140/dd253202.aspx
In addition, OWA and Exchange online are same thing.
Thanks,
Aaron Yuan