Don’t you find it a little odd that user notifications for your Gravity Forms are going out, but you’re not getting admin notifications supposedly sent from the exact same mail server? Hum… yes… very fishy indeed.
This problem is tied to a very well-known issue that some hosts will not send email to another email address on the same domain. Both Yahoo and Google do this so if you’re using, say, Gmail for your own domain, you’re likely going to see this issue IF, you’ve also configured Gravity Forms in a particular way.
Yes this problem is two-fold. You’ve got an email server that won’t allow sending to itself AND you likely have the FROM EMAIL field for the admin notification set to use the email address of the person who submitted the form.
Don’t do that!
That’s your problem. When you do that, and the person who submitted the form used an email address with the same domain as yours, or who may, for example, be using Gmail and you’re also using Gmail to host your domain’s email, then you’ve configured your admin notification to use an address that will potentially cause the server not to send the email.
It’s a bit of a mind-bender. Agreed. You don’t have to understand it. Just try using {admin_email} in that field instead and see if that doesn’t solve the issue. If not, you’ve got real SMTP or mail() issues beyond the scope of Gravity Forms.