Please note that the Chocolate - Free Hosting plan is not allowed to perform outgoing connections to remote servers, which is the reason for the error message that you have got. The reason for this situation is due to the increasing number of complaints about abusive free web hosting account usage. Freehostia.com was forced to discontinue the support of outgoing connections to remote servers for all free web hosting accounts, because of too many abusers, hacking many sites over the internet. Our data center is forcing us to take actions and stop those abusers and unfortunately this is the only way.
Our paid hosting plans do not have this restriction. You can upgrade your web hosting plan from the "Change plan" section on your control panel, you will find the link on the left "Upgrades" menu.
Upgrading to a paid hosting plan would also allow you to send e-mails via your account with us - the SMTP will be activated for you and you will be allowed to upload files bigger than 500KB. The Watercircle plan is only $2.95/month and has no such restriction. In addition disk space, monthly traffic and other features will be increased significantly. You will be able to check a comparison of our payed hosting plans features here:
http://freehostia.com/compare-hosting-plans.html
If you have any further questions or problems, please do not hesitate to contact us!