Yes I have a DNS server and before I setup the mac server I set up foward and reverse DNS entries on it for the mac server.
In all likelihood, your DNS configuration is in error.
So I guess my question is do I need to run the DNS service off the mac server if I intend to run the podcast and ical services?
Absolutely not.
After I set those services up I and restart the server I get a knetworkerror when I open serveradmin and the computer starts to crawl. Is that because I did not setup the DNS service on the mac or is it a different issue?
That usually means your DNS is in error.
Again, +you need correct DNS services for your server (and from your clients), but you do not need to run those DNS services on the Mac server.+
Mac OS X and Mac OS X Server are both perfectly willing and able to reference and to use DNS services running on Windows, Linux, HP-UX, Plan9, OpenVMS, Solaris, FreeBSD, Tru64 Unix or pretty much any other OS that can run a DNS server, so long as those DNS services are correctly configured.
Specifically for this case (and assuming you're running Server Admin on a client box and not directly on your new Mac OS X Server), you
also need correct DNS services available from your client when you are running various services including Server Admin, and if your client is not correctly referencing your LAN DNS, then it is distinctly possible that your server is a bystander here.
From your client and from your server, launch Terminal.app and issue the following commands:
dig yourservername.example.com
dig -x your.server.ip.address
and post the results.