I can't see what is wrong off the bat.
Your DNS is correct, they both resolve to your IP.
Code:
#nslookup postalote.com
Name: postalote.com
Address: 109.74.196.124
#nslookup www.postalote.com
Name: www.postalote.com
Address: 109.74.196.124
I am not too familiar with what the /etc/hosts file is used for. But I looked in mine and the domain was not in there by itself.
Mine looks like this, with the xx masking my real IP, and example.com taking the place of my real primary domain.
Code:
127.0.0.1 localhost
xx.xx.xxx.xx leroy.example.com leroy
So it has hostname.domain and then hostname, but not just domain. Since your domain name by itself is being the culprit and it is in your hosts file, to me it might be the problem.
So maybe give that a try. Also it is along the lines of "is your computer plugged in" but did you reload or restart Apache after your configuration change. It has happened to me on more then one occasion.
I am really just guessing here, just helping you troubleshoot so please make backups and don't get mad if my suggestions screw things up.