Basic Address Book problem: difficulty sending group e-mails

I am using OS.X and have just started trying to make more use of the Address Book function.

I intend to set up a e-mail mailinglist with all my company's contacts, a few hundred, as well as a list to make address labels for snail mail. However, I have encountered difficulties at a very early stage:
I set up a test group of 3 addresses and attempted a "mass-mail" to these by right clicking and choosing the command <send Email to "test group">. My Entourage client pops up with a new message where 'test group' is written in the To: field. These e-mails cannot be sent however as they contain no actual e-mail addresses. I have tried to find a place in preferences in Address Book where I can regulate the communication between my Address Book and the e-mail client, but unfortunately this is oh-so-simplified giving me little leverage as to get to grips with the problem.