We have three local namespaces: proddomain.local, testdomain.local, devdomain.local. All of our client computers in the organization are part of the proddomain.local domain. If I select "Disable NetBIOS over TCP/IP" on the WINS tab of the Advanced TCP/IP Settings dialog (Windows 7) and "ping devcomp1" I get back "Ping request could not find host devcomp1." (If I leave the NetBIOS setting on Default and ping devcomp1 I get back, "Pinging devcomp1" with the IP address, etc.) On Wireshark I see the response from the DNS server as "No such name". I am, however, able to sucessfully ping devcomp1.devdomain.local.
I'm researching how the DNS could be misconfigured but I wanted to put this out there as part of my investigation.