It sounds to me as if the script in cgi-bin/formmail.pl is not working correctly for some reason.  I don't think this would affect things, but I noticed you did not close your FORM tag.  Lastly, are you nesting your form inside another form?  Keep in mind that ASP.NET apps in general (and DNN is no exception) tend to wrap most of the page in a <form runat='server'> tag.

On a totally different topic, let me give you a suggestion on how to handle long strings in C#.  Try this:

test = @"

<FORM ACTION='cgi-bin/formmail.pl' METHOD='POST'>
    <INPUT TYPE='HIDDEN' NAME='Name' VALUE='name' SIZE='25' MAXLENGTH='50'>
    <INPUT TYPE='HIDDEN' NAME='Email' VALUE='email' SIZE='25' MAXLENGTH='50'>
    <INPUT TYPE='SUBMIT' NAME='name' VALUE='label'>
</FORM>";

It's called a "Verbatim Literal" -- you can use linebreaks right inside the string.  One of the reasons I prefer C# over other .NET languages :-)