I own a custom domain, i.e myself.com. I would like to make all email sent to email@example.com to be delivered to firstname.lastname@example.org. I do not want to use Google's Google Apps, or Microsoft's Live Admins. Is this possible using DNS only?
Hotmail is the same as Microsoft Live, so you could do this by setting up custom domains to accept mail via an additional domain, and then create an alias for email@example.com. Mail sent to firstname.lastname@example.org or email@example.com will end up in the same mailbox.
DNS has no part in email redirection. MX records in DNS just specify which servers handle mail for a given domain.
I use a product from zoneedit.com. It allows me to manage my DNS and set up custome forwards for all email headed to my domain. I hand out my firstname.lastname@example.org address to everyone and have zoneedit forward it to gmail. from there I tell gmail to send the reply-to as the same address. Zoneedit doe the same for web pages, etc. Check it out