Sams Teach Yourself PHP, MySQL and Apache All in One (4th Edition)

How can I ease the burden on my mail server?

Besides looking into package mailing list software, you can bypass the mail() function and talk directly to your SMTP server via a socket connection. Such an example is shown in the PHP manual for the fsockopen() function (http://www.php.net/manual/fsockopen), as well as in other developer resource sites.

Where do bounced messages go?

Bounces go to whatever address you specify in your From: or Reply-to: mail headers.