Hi Nathan,
PF replication is working fine now, slowly but surely. What I had wrongly setup was a smart host on the Default Receive E2007 Connector. As soon as I removed that, and then restarted IIS on E2003, PF replication started to work!
Here is how to get to the settings of the connector, on E2007 Mgmt Console:
Server Config > Hub Transport > Network Tab > Receive mail from remote servers that have these IP addresses. Here i had the IP of a smart host. I replaced that with IP 0.0.0.0 and Mask 255.255.255.255
However, I am now thinking is that right???? Shall I take it that that need to create another connector that will have the IP of the smart host???
No news re OAB, but i will look at that next and post back.
Thanks for your help Nathan. Much appreciated!
Ioana