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Hmm.. Doesn't sound good. What version of PHP are you using?
I'm using 4.0.6 and I've just tried your exact settings plus countless other combinations and I can't duplicate the error.

Double check the changes you made in sendtofriend.php. It should look like this:

  // START MIME/HTML/SMTP HACK
  eval("\$messagehtml = \"".gettemplate("email_sendtofriend_html",1,0)."\";");
  mime_mail($sendtoemail,$emailsubject,$message,"From: \"$bbtitle Mailer\" <$webmasteremail>",$messagehtml);
  // END MIME/HTML/SMTP HACK

Note: the html template does NOT need to exist even if you select MIME/HTML in the control panel.