Default internet domain not working in 5.2 RC1

I just reinstalled 5.2 RC1 from the cdrom, have since updated to a 
custom kernel.
The problem is that whenever i try to resolve any hosts in my domain 
without using a fully qualified domain name the look up fails.

Host name resolution works on all other machines within the network 
without a problem.
All machines have the following in /etc/resolv.conf:
domain giallarhorn.org
nameserver 192.168.1.1
nameserver 192.168.1.5

I even tried using the search keyword without any luck.