The Rule of Setup DNS Forwarding

If you have just one DNS server, you should forward to your ISP's. If you have multiple DNS servers, they should forward to an ISP's, or if a child
domain in a delegation scenario, to forward to the parent, then the parent forwards to the ISP.

Note: Based on Microsoft FAQs, you don't need to configure forwarders in DNS. By default, Windows 2000 DNS uses the root hint servers on the Internet; however, you can configure forwarders to send DNS queries directly to your ISP's DNS server or other DNS servers. Most of the time, when you configure forwarders, DNS performance and efficiency increases, but this configuration can also introduce a point of failure if the forwarding DNS server is experiencing problems. The root hint server can provide a level of redundancy in exchange for slightly increased DNS traffic on your Internet connection. Windows Server 2003 DNS will query root hints servers if it cannot query the forwarders.

DNS how to

zone does not exist under forward lookup zones in DNS, the DNS service uses ... You must delete this zone to enable the DNS server to forward DNS requests. ...
www.howtonetworking.com/server/dns.htm

Troubleshooting DNS

Event ID 7062

1. DNS servers should not forward to themselves: DNS can be configured to forward off-site queries to designated servers. Be sure that the DNS server is not ...
www.chicagotech.net/troubleshooting/eventid7062.htm