ARD DNS Name Does not match Name

In ARD Admin 3.5.1, 3.5.2 and 3.6 the listed Client Name and the listed DNS Name don't match.

All clients are 10.6.8v1.1 OS.

I verified that all DNS is showing up correctly on our DHCP server and on our DNS servers.

When I go into Sharing preferences on a client which is showing up with the wrong DNS in ARD, local hostname shows correctly yet under File Sharing is shows access to the client from a web address which is incorrect and from a local hostname which is correct.

So For example, I go into Sharing Preferences and change the name of the computer to TEST123

The local hostname changes to TEST123.local yet under File Sharing: On it says:

Other users can access shared folders on this computer, and administrators all volumes, at afp://XYZ321.domain.org/ or “TEST123”

XYZ312 is a DNS name for another unrelated computer on the network.

When I go into Terminal, Terminal also shows

XYZ321:~ localuser$

When it should say

TEST123:~ localuser$

When I type hostname in terminal it comes back with

XYZ321.domain.org instead of TEST123.domain.org

So how do I fix this issue for 50 computers?

Thanks for any assistance.