#mailhop

First we need to verify that port 25 is working.

Try telnet outbound.mailhop.org 25

If you can't connect, try again using another port.

ehlo <your domain>

If there isn't 250-STARTTLS then something is not right. Try again using another port (e.g. 10025)

The actual configuration

Leave "Default SMTP Virtual Server" as is. Revert all outbound security and smart host configure. Only change outbound connection TCP port. (For more information on how to change please google for Microsoft Knowledge Base: 274842 How to change SMTP port 25 to another port in Exchange 2000 and in Exchange 2003. 

Create new SMTP Connector.

On the General tab, provide an appropriate identifying name for the connector. I used the name ‘SMTP Smart Host Relay for DynDNS Connector’.

Choose to use DNS or forward to a smart host.  Enter ‘outbound.mailhop.org’ or you use the IP address of the smart host in square brackets. [63.208.196.171].  I would enter the FQDN rather then the IP address

Under Local Bridgeheads, click Add. Add the server that becomes the bridgehead server for the routing group. Designate an SMTP virtual server as a bridgehead server for the SMTP connector. This can be either the server that you are working on or another server in the same routing group. Alternatively, this duty can be shared by multiple servers.

Click the Address Space tab. Under Connector Scope, click either Entire Organization or Routing Group. As in earlier versions of Exchange Server, when you configure the Internet Mail Service, click Add, click SMTP, and then click OK. Accept the default (*) unless you require outbound e-mail domain restriction, and leave the cost as 1. If you have accepted the default of (*), you should never click to select the Allow messages to be relayed to these domains check box. Clicking to select the Allow messages to be relayed to these domains check box would open your server for relay to the world. The Allow messages to be relayed to these domains check box should be for secure domain to domain connections only.

If you have chosen forward all mail to a smart host, click the Advanced tab. Click the Outbound Security option, and then select an appropriate authentication method for your relay host. The default is Anonymous Access. You must change this to Basic authentication (password is sent in clear text).   Now click the Modify button.  Now you must enter your DynDNS user account information.  Enter your DynDNS user name and the password.  Then confirm the password.  Check TLS encryption. You don't need to use "SMTPS (SSL/TLS)" port if you enable TLS encryption. You can use port 25/10025 and TLS altogether. (Given that the server response with STARTTLS in the previous steps) NOTE: If there is an error here under your connector you won’t be able to send email out.  Mail will be stuck in the queue.

The article said you need to restart Microsoft Exchange Routing Engine service and Simple Mail Transfer Protocol (SMTP) Service but in practice, I didn't have to restart anything. (Exchange 2003)