Postfix "unknown user" bounce
 

I'm attempting to add internal mail transport to my LAN using Postfix.
I can receive mail when it's sent to root@myip.net, but not when sent to a particular human user.
(ie. sue@myip.net) results in

Jun 29 13:04:56 myserver postfix/local[2739]:
C8E5D23217B: to=<sue@myip.net>, relay=local, delay=5,
status=bounced (unknown user: "sue")

(Taken from /var/log/maillog)

There is a 'sue' in my /var/spool/mail/.

"[root@myserver root]# postconf -n
alias_database = hash:/etc/postfix/aliases
alias_maps = hash:/etc/postfix/aliases
command_directory = /usr/sbin
config_directory = /etc/postfix
daemon_directory = /usr/libexec/postfix
debug_peer_level = 2
default_privs = nobody
inet_interfaces = all
local_recipient_maps = $alias_maps unix:passwd.byname
mail_owner = postfix
mail_spool_directory = /var/spool/mail
mailq_path = /usr/bin/mailq.postfix
manpage_directory = /usr/share/man
mydestination = $myhostname, myserver.$mydomain, $mydomain
mydomain = myip.net
myhostname = myserver.myip.net
mynetworks = 63.167.114.16/28, 24.147.133.219/8
mynetworks_style = class
myorigin = $mydomain
newaliases_path = /usr/bin/newaliases.postfix
queue_directory = /var/spool/postfix
readme_directory = /usr/share/doc/postfix-1.1.11/README_FILES
relay_domains = $mydestination
relayhost = $mydomain
sample_directory = /usr/share/doc/postfix-1.1.11/samples
sendmail_path = /usr/sbin/sendmail.postfix
setgid_group = postdrop "




Any ideas?