Why is $domain not set in the smtp transport?

The smtp transport can handle several recipient addresses at once. This happens by default if the host lists for the addresses are identical. A single copy of the message is sent, using multiple <small>RCPT</small> commands to transmit multiple envelope recipients. The $domain variable is set in the smtp transport only if all the recipient addresses have the same domain. You must have a case where several addresses with different domains resolve to the same set of hosts. If you want to restrict the transport so that it handles only a single domain at once (but still possibly with more than one recipient), set

multi_domain = false

If you want to restrict the transport so that it handles only a single address at once, set

max_rcpt = 1