I havn't looked at the mail() function within phpBB, but this is usually due to not having the right headers on the mail script.
I usually stick the lot in, for example
This seeems to work fine.
However, if you miss out some of the headers the accounts such as Hotmail don't always seem to like it.
Andy
Edit: Opps - there were a couple of mistakes in that code (it was late last night!!!) I've corrected it.