Unable to move public folder replicas to exchange 2007 from the SBS 2003 server after you have performed a migration. If you check the Queue you will see a bunch of messages stuck in the Exch2k3 - Exch2k8 Routing Group Connector. If you turn on SMTP logging you will see the public folder replication messages are being sent to a remote server.

 

 

This occurs because they have configured a smarthost on the SMTP virtual server in SBS 2003. The routing group connector for public folders binds to the default SMTP virtual server for SMTP traffic and attempts to use it for SMTP communication.
Public folders send their replication messages thru SMTP so If a smarthost is configured on the SMTP virtual server, it will send the replication messages to
your smarthost.

To Resolve this problem go to the properties of the SMTP virtual Server
- Go to the delivery Tab
- Click Advanced Button and delete the smarthost server.
- Restart SMTP