Windows – DHCP lease information to file

Are you running RRAS (Routing and Remote Access Services) on the server? Maybe this forums thread can help: Windows 2003 DHCP issuing RAS addresses.

The fact that you see 10 IP addresses is cuased by the fact, that RAS obtains, by default, 10 IP addresses to lease to clients. If all 10 IP addresses are used, RAS obtains 10 more.

And read this article about the DHCP relay agent and this Microsoft Support article.

UPDATE:

If the modem is only used for sending and receiving fax, RRAS is not needed. But you should check/ask, if this server is also used as a network router and/or for accounts which connect from remote.

If you wish to disable RRAS without un-installing, you could go to the Windows Services panel and change the "Routing and Remote Access Service" to disabled.

If you are sure you won't use RRAS, open the RRAS console, right click on the server name and choose "Disable RRAS". If you later want to enable it again, you'll have to reconfigure RRAS.

BAD_ADDRESS is IP address confliction, so the DHCP-server obviously gets a reply when it tries to ping those addresses. Have you tried using ping manually from the DHCP server? You could also try to look at the arp cache (arp -a in a commandline shell).