I am running Kmail 1.10.0 under KDE 4.1.1 (Release 26.4) on a 64 bit AMD with the 32 bit versions of Opensuse 11.0 and software installed. When I create a new email and begin typing the name of one of my distribution lists on the "To:" line, it autocompletes with the name of the list, but when I send, it fails to populate the "To:" filed with the addresses in the list. Instead, it assumes that the name of the list is an email address at my local machine (in the form distributionlist@localhostname) and gives me an error message saying that the email will not be sent until that address is deleted.
There was a bug report (Number 148479) filed last summer at
http://bugs.kde.org/show_bug.cgi?id=148479
that reported the same problem. I've commented and voted for the report. If anyone else is experiencing the same problem, please vote for this bug. I frequently use this feature, and feel its absence frequently.