DNS testing

I have an internal resolving only DNS server.

dig @dns1.example.com www.google.com<http://www.google.com>

Gives me a valid response.

dig @dns1.example.com dns1.example.com Fails, since dns1.example.com is not a valid address on the internet.

Is it a requirement for dns1.example.com to be able to resolve it's own name?

I tried this in bb-hosts

0.0.0.0 dns1.example.com # dns=ns:google.com

But Xymon gives me a red page stating that dns1.example.com service is unavailable.

Craig