defining "DNS Suffix Search List" in /etc/dhcpd.conf

You need to use the "option domain-name" parameter, a la:

option domain-name "domain1.com domain2.net domain3.org";

Don't forget the quote marks around the search domains, and the semi-colon
at the end of the option line.

http://linux.derkeiler.com/Mailing-Lists/RedHat/2005-06/0242.html