If you see this error, the form and thus plugin usually works fine to the point of sending the email.

1. please double check your Form Admin / Email Options settings thoroughly for correct email address(es)
2. Try alternative admin email addresses
3. Do you receive any emails from W (e.g. passwords, comments notifications)?
4. Check your PHP servers mail() function
5. Can you check your mail servers log files?

The issue has very likely to do with either a local mail server problem, a malformed email address or a general issue with the PHP function mail(); – if the latter is the case and your blog is using wp_mail(); you may want to try and replace all instances of @mail with wp_mail in cforms.php (search &replace).
You may want to check with your hosting provider first.

When and where do you get this warning message? After you changed to wp_mail?

You could try one more thing, and that is: search the hardcoded FROM: address, just look for "From:" and replace whatever comes after that with an email you're positive that your mail server knows and accepts:

Look for all:

$headers = "From: \\"".get_option('blo [....]  ">" . $eol; 

And change to,e g.:

$headers = "From: <youremail@domain.com>" . $eol;

I can also offer to take a quick look at your form configuration, just use the BACKUP button on the main admin page and reply to my email (just send you one).

Excellent!

In hindsight, I think I should've left the FROM: config field in the admin interface for better flexibility  – despite the risk that I may actually get even more support requests for mal-configured ones ;-)