Not Receiving Incoming Email from Drop folder

Hello,
I hope that someone out there will be able to help me with this issue. I am fairly new to MOSS2007 but belive that I have configured e-mail to list correctly, I followed the steps set out by Steve Smith
http--www.combined-knowledge.com-Downloads-How%20to%20configure%20Email%20Enabled%20Lists%20in%20Moss2007%20RTM%20using%20Exchange%202003.pdf
The process all follows fine and when I attempt to send to a configured mail enables list I can see the mail make it to the drop folder as it should. This is where the problem occurs, it is never picked up by the Windows SharePoint Services Timer service. The e-mail's I send just sit in the drop folder and nothing is happening.
As this is a fairly simple thing to setup there isn't a great deal of troubleshooting info out there and most of it just says check the basics like making sure that in the central administration console>Incomming Mail Settings the drop folder is specified as C:\inetpub\mailroot\drop (which it is)
I've been through the event logs and those created by sharepoint but can't see anything that looks like an error causing this issue and nothing in the applications logs either. I'm in limbo at the moment because so far as I can see I have setup correctly, mail delivery is succesful and nothing to suggest what is causing the issue.
I have reset the permissions on the drop folder to grant full access to the service account that runs the Windows SharePoint Services Timer service, I have even added the Windows SharePoint Services Timer service account to the domain administrators group to try and make sure its not a permissions issue.
Any advise would be appreciated because I've ran out of idea's now!?
Thanks in advance.
Drew

Hi,
Did you select “Directory Management Service” option, if so, please make sure you configure the Central Administration application pool identity account to have the Create, delete, and manage user accounts right to the container that you specify in Active Directory.
Did you install Exchange server 2003 in your MOSS environment? If so, you should add an SMTP connector in Exchange Server, if you don’t know how to do that, you can post your issue into the following forum:
http://social.technet.microsoft.com/Forums/en-US/exchangesvrdeploy/threads
Also, please check whether your configuration meet the following requirements, If not, correct them and check the effect.
·         The application pool account for Central Administration, the logon account for the Windows SharePoint Services Timer service, and the application pool accounts for your Web applications should have the correct permissions to the e-mail drop folder.
·         The domain controller running Active Directory has a Mail Exchanger (MX) entry in DNS Manager for the mail server that you plan to use for incoming e-mail.
For more information about how to configure incoming e-mail settings, please refer to the following article:
Configure incoming e-mail settings
http://technet.microsoft.com/en-us/library/cc262947.aspx
Introduction to incoming e-mail
http://office.microsoft.com/en-us/sharepointtechnology/HA100823061033.aspx
Demo: Configure a SharePoint Server 2007 site to receive e-mail
http://office.microsoft.com/en-us/sharepointserver/HA102047921033.aspx?pid=CH101788401033
Enable and configure e-mail support for a list or library
http://office.microsoft.com/en-us/sharepointtechnology/HA100823071033.aspx?pid=CH101215271033
Rock  Wang 
Rock Wang– MSFT

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