what did you put for the domain on the host, what are you doing the query for - does you machine use search suffixes. Is the forwarder working for looking up say www.google.com. Are you SURE you pointing to your forwarder. Do you have pfsense using the forwarder via 127.0.0.1
How about you show us your host over rides, and then simple query.
C:>dig i5-w7.local.lan
; <<>> DiG 9.10-P2 <<>> i5-w7.local.lan
;; global options: +cmd
;; Got answer:
;; ->>HEADER<<- opcode: QUERY, status: NOERROR, id: 30484
;; flags: qr aa rd ra; QUERY: 1, ANSWER: 1, AUTHORITY: 0, ADDITIONAL: 1
;; OPT PSEUDOSECTION:
; EDNS: version: 0, flags:; udp: 4096
;; QUESTION SECTION:
;i5-w7.local.lan. IN A
;; ANSWER SECTION:
i5-w7.local.lan. 86400 IN A 192.168.1.100
;; Query time: 3 msec
;; SERVER: 192.168.1.253#53(192.168.1.253)
;; WHEN: Tue Oct 07 06:32:35 Central Daylight Time 2014
;; MSG SIZE rcvd: 60
C:>dig -x 192.168.1.100
; <<>> DiG 9.10-P2 <<>> -x 192.168.1.100
;; global options: +cmd
;; Got answer:
;; ->>HEADER<<- opcode: QUERY, status: NOERROR, id: 29216
;; flags: qr aa rd ra; QUERY: 1, ANSWER: 1, AUTHORITY: 0, ADDITIONAL: 1
;; OPT PSEUDOSECTION:
; EDNS: version: 0, flags:; udp: 4096
;; QUESTION SECTION:
;100.1.168.192.in-addr.arpa. IN PTR
;; ANSWER SECTION:
100.1.168.192.in-addr.arpa. 86400 IN PTR i5-w7.local.lan.
;; Query time: 2 msec
;; SERVER: 192.168.1.253#53(192.168.1.253)
;; WHEN: Tue Oct 07 06:32:46 Central Daylight Time 2014
;; MSG SIZE rcvd: 84
C:>