I think talking to Wanadoo is probably the first step. I googled your error, and there were a couple of hits from people who had the same problem. They were also on wanadoo.
Its a bit of a guess, but it looks like you are trying to connect to your bt internet mail account, but using a wanadoo dial up. Wanadoo is trying to force you to use their SMTP server instead. One of the posts I saw on the internet said that wanadoo only let you use their mail server, but I don't know if that is true or not.
EDIT: Looks like I was right about wanadoo blocking SMTP servers. There is a w**k around though. You need to configure your outgoing email to use wanadoo's server, but to pretend it has the email address of your BT Internet account. That way, anyone who clicks reply will come back to your BT internet one, rather than Wanadoo, and you don't have to worry about changing your email address. might sound complicated, but there is a step by step guide
here