The only DNS server that should be configured on a Windows domain should be the DNS server hosting the domain, and if you've only got one server it should have DNS installed and configured on the domain controller. Using ISP DNS servers instead of the DNS server on the DC will cause your machines to not be able to find the domain controller.
Generally, when I set up a small domain, I install DHCP and DNS on the server to be the first domain controller, then install active directory. Once complete (it will configure DNS automatically during dcpromo), I configure a DHCP scope and options to be assigned via the DHCP management snap-in, authorize the DHCP server, and deactivate any other DHCP servers I might have on the network (home routers, etc). That way, all machines will get a DHCP address from the DC, and the options should only have the DC's IP address configured as the DNS/Name server. Things will work best that way.