Thanks for the clarification freedog. I was leaning in that direction and thought to try using my ISP's SMTP but mail still ends up in hotmail junk folder. It's really odd. I tried it again after reading your post and it worked! Not sure what is going on but thank you for your informative reply.Correct me if I am wrong, but I am reading the use of "forwarding" as being synonymous with "relaying" which is what really creates the problems.
To resolve this problem, I have changed my outgoing SMTP servers in Outlook, Thunderbird, and the like to use the SMTP for the ISP that I am connected to, in my case Verizon.