The Display Name of Notes users who were listed in Exchange as Contacts was set correctly. Outlook users saw the name correctly in their Outlook client, however when the emails were recieved back from Notes the Display name was replaced by an SMTP style address instead of a more friendly Display Name
This was caused by misconfiguration on the Receive Connector
To resolve this issue, set the Authentication on the Receive Connector associated with CMN to have Externally Secured Authentication
The diagram below will show you where to set this setting:
