I've configured my Linode for email using the Linode Library Debian/Squeeze guide for postfix and dovecot.

FQDN is cheshire.yyrrll.net

I create virtual domain yyrrll.net and user sysadmin@yyrrll.net.

I become user gordon, open mutt over imap with the sysadmin credentials, and send an email.

I expect the email to be sent From: sysadmin@yyrrll.net, but it is instead sent from gordon@cheshire.yyrrll.net. The reply goes to gordon@cheshire...

My DNS zone records list cheshire.yyrrll.net as the MX record for cheshire.yyrrll.net. I can send email to sysadmin@yyrrll, but when I check mail via mutt any reply comes from the system user that logged in to mutt.

What am I doing wrong here?

The "From:" address in email has nothing to do with IMAP, and nothing to do with MX records. It has everything to do with what your mail program (mutt in this case) thinks its "From:" address is, and you can set this to any arbitrary email address.

From MuttWiki: How do I set my From: address?