@johnpoz
We do not always have the same skill levels at everything we do. Some things we know less about and know more about other things. That is the beauty of forums, after struggling to learn and try on your own, you hope that someone that does have the knowledge will step up and explain and not chastise.
I'm not saying you chastised me but that each step learned from using pfsense is one that gives me some extra knowledge to know how to look for the next problem.
Anyhow, in my case, I just want pfsense and all of the internal servers to use the local DNS servers. The firewall itself doesn't need to resolve or forward anything, it can use the locals as well. The problem was that is was adding 127.0.0.1 as the first nameserver for all of the DHCP hosts.