Unrecognized Recipient when trying to email using Microsoft Outlook with WinSpool/400 Email Report Server

Problem:

When you try to send to email with Microsoft Outlook 2000 via WinSpool/400 Email Report Server and you are using your personal address book to manage group email recipients, you get the error:

Solution:

In Microsoft Outlook 2000, go to Tools > Services and set up the Addressing tab to look like this: