I'm 99.9% sure that it is something to do with the way that the desire sends text messages that cause a problem on the O2 network. It may be because there is no 'outbox' function and if the text message can't go straight away (dodgy coverage or busy local cell) then it just comes up with the error.
I've never had this issue once with O2 with an iPhone, sounds like a pretty flawed design if it's causing Fox as much trouble/annoyance as above.