I had exactly these symptoms. Make sure the machine running the server can actually ping the address/dns name in your realmlist. You might have routing issues preventing that machine from pinging its external IP, or nameserver issues preventing proper lookup. Once I got that resolved (bad nameserver in my case) everything was right as rain.
Stuck at connected / infinite loop / login issues / battle.net
in Help and Support
Posted
I had exactly these symptoms. Make sure the machine running the server can actually ping the address/dns name in your realmlist. You might have routing issues preventing that machine from pinging its external IP, or nameserver issues preventing proper lookup. Once I got that resolved (bad nameserver in my case) everything was right as rain.