What firewall are you using?
Could be EDNS, the expectation is that you will allow UDP packets larger than 512b through, and some firewalls do not by default.
If you want to test it on the server-side, run:
dnscmd /config /enableednsprobes 0
Otherwise you're going to have to check network access rules from your server to the outside world. It will need from any local address to any remote address on UDP and TCP port 53.
Note: TCP 53 is used when a UDP response is truncated, not the same as a UDP response being dropped.
Chris