554 relay error

Please help. I have been working for about a week on the webmail 554 error. Here is my (postconf -n) info:
alias_maps = hash:/etc/aliases
command_directory = /usr/sbin
config_directory = /etc/postfix
content_filter =
daemon_directory = /usr/libexec/postfix
debugpeerlevel = 2
enableserveroptions = yes
html_directory = no
inet_interfaces = all
mail_owner = postfix
mailboxsizelimit = 0
mailbox_transport = cyrus
mailq_path = /usr/bin/mailq
manpage_directory = /usr/share/man
messagesizelimit = 0
mydestination = $myhostname,localhost.$mydomain
mydomain = yegerman.com
mydomain_fallback = localhost
myhostname = mail.yegerman.com
mynetworks = 64.19.74.70,192.168.1.40,192.168.1.50,192.168.1.101,192.168.1.102,192.168.1.103 ,192.168.1.104,192.168.1.105,192.168.1.106,192.168.1.107,192.168.1.108,192.168.1 .109
mynetworks_style = host
newaliases_path = /usr/bin/newaliases
ownerrequestspecial = no
queue_directory = /private/var/spool/postfix
readme_directory = /usr/share/doc/postfix
recipient_delimiter = +
sample_directory = /usr/share/doc/postfix/examples
sendmail_path = /usr/sbin/sendmail
setgid_group = postdrop
smtpdpw_server_securityoptions = none
smtpdrecipientrestrictions = permitmynetworks,reject_unauthdestination,permit
smtpdsasl_authenable = no
smtpdtls_keyfile =
smtpduse_pwserver = no
unknownlocal_recipient_rejectcode = 550
virtualmailboxdomains =
virtual_transport = virtual
Thanks for all of your help in advance.
PowerMac G5   Mac OS X (10.4.3)  

Hi Jeff,
Thanks once again for the help. I fixed everything you sugested but I am still getting a 554 Relay Access Denied error. Here is what it looks like (back from the postmaster in Apple Mail):
From: [email protected]
Subject: Undeliverable Mail
Date: December 21, 2005 11:31:35 PM EST
To: [email protected]
Unknown user: [email protected]
RCPT TO generated following response:
554 <[email protected]>: Relay access denied
Original message follows.
Received: from [192.168.1.40] [64.19.74.70] by mail.westelcom.com with ESMTP
(SMTPD32-8.15) id AC2735560036; Wed, 21 Dec 2005 23:31:35 -0500
Mime-Version: 1.0 (Apple Message framework v746.2)
Content-Transfer-Encoding: 7bit
Message-Id: <[email protected]>
Content-Type: text/plain; charset=US-ASCII; format=flowed
To: [email protected]
From: Rory Yegerman <[email protected]>
Subject: test
Date: Wed, 21 Dec 2005 23:31:34 -0500
X-Mailer: Apple Mail (2.746.2)
test
Also, in workgroup manager does it matter if under mail server it is my ip or mail.<my domain>.com?
Thanks once again for the help
PowerMac G5 Mac OS X (10.4.3)

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