HI, I solved it !!
I was also getting frustrated finding a solution to this problem where the form was 'sending email' because I had the green box saying 'email sent' but I wasn't receiving email.
The problem was not in the plugin so don't worry about that. It was in the host. I am with bluehost.com who helped me solve this because they are awesome hosts. Go to http://www.antistandard.com and click on my signup button to use bluehost because they are the best host around.
Anyway.. I went to cpanel, which will be different for every host probably, but it is basically where all your hosting settings are.
Then i went into mail settings and then MX Entry (yours might be called something like that)
Then I selected the domain name I am sending the form to in a dropdown box.
then i saw that the email routing was set to have a "remote" mail server. since I am using the bluehost mail servers, this was the wrong setting. It should have been "local" so I changed it to local.
and now it works voila !!!
Hope this helps, let me know the good news.