The messages from mailer-daemon are only notifications of undeliverable messages.
Those messages are sent by several infected computer somewhere in the worls using falcificated headers with your address as originator.
The list they use is of low quality and contains LOTS of fake addresses, or that have been abandoned.
Your ISP can't help as they have nothing to do with that.
For the scam sent to your contacts, it was sent by some crooks using some bot net. They probably lifted your address somewhere, the list of the possible "somewhere" would fill a dictionary.
What can you do?
Sadly, not much. Your e-mail address is circulating world whide now.
You may try getting a new e-mail address and ask your contacts to stop using the old one and switch to the new one. BUT, if any of them is infected by a virus or spyware, your new address will get spread again.
Electro
April 2011