As I understand it, ssh is supposed to automagically forward X11 after connecting. I gather this error message is whats preventing this from happening in my case. Thinking it was a host-lookup problem, I added my machine's hostname (homeworld; no domain) to the /etc/hosts file on the client machine.
[alex@waherlinux etc]$ ssh <my.ip.address>
Enter passphrase for RSA key '/home/alex/.ssh/identity':
Last login: Wed May 8 15:44:42 2002 from <another.place>
/usr/X11R6/bin/xauth: (stdin):1: bad display name "homeworld:10.0" in "add" command
Funny-- ha ha.. Without even posting this, I came to realize that I should try adding my hostname/IP to the /etc/hosts file of the server
. Sure enough.. it works. Strange.. a machine running a DNS server can't see itself. Oh well.. guess its time to get a domain name