This is an old posting and you have probably worked out an answer already but in case it helps anyone else, I had a similar problem.
I fixed it by editing the php.ini and adding the explicit path to the sendmail command.
sendmail_path = /usr/sbin/sendmail -i -t
Your path might be different but you can find it with this command
(I have access to the command line on my Linux server - you may not be so lucky)