This webpage has a redirect loop - IIS7 - redirect

Question

I have a small site where I have a mailing list contact form in an iFrame, and once its submitted, a callback page I registered with the mailing list service is called, displaying in the iFrame and asking the user to check their email. The page I registered is http://mydomain.com/verify.html. In vertify.html I use "window.parent.document.getElementById('lightbox4').style.display='none';" to close the lightbox div that contains the I frame. This all works well, as long as the user initially visits http://mydomain.com, but if they visit http://www.mydomain.com, then calling "window.parent.document.getElementById('lightbox4').style.display='none';" doesn't work, because its a cross domain request.
So, no problem I thought, I'll just create a redirect rule to convert calls from www.mydomain.com, to mydomain.com. But now I'm getting the error "This webpage has a redirect loop" when I try to go to either www.mydomain.com or mydomain.com. In IIS7, I have two bindings, one for mydomain.com and one for www.mydomain.com. My DNS zone has an A record for mydomain.com, and a CNAME for www.mydomain.com.
Am I doing something stupid here? Is there ome way to debug this? I can see in Firefox, using the Live HTTP headers plugin, the URL is redirected properly from www.mydomain.com to mydomain.com , but then tries to keep trying to redirect mydomain.com to mydomain.com, creating the endless loop:
http://www.mydomain.com/
GET / HTTP/1.1
Host: www.mydomain.com
User-Agent: Mozilla/5.0 (Macintosh; Intel Mac OS X 10.8; rv:20.0) Gecko/20100101 Firefox/20.0
Accept: text/html,application/xhtml+xml,application/xml;q=0.9,*/*;q=0.8
Accept-Language: en-US,en;q=0.5
Accept-Encoding: gzip, deflate
Connection: keep-alive
HTTP/1.1 302 Redirect
Content-Type: text/html; charset=UTF-8
Location: http://mydomain.com/
Server: Microsoft-IIS/7.0
X-Powered-By: ASP.NET
Date: Sun, 21 Apr 2013 15:20:12 GMT
Content-Length: 150
----------------------------------------------------------
http://mydomain.com/
GET / HTTP/1.1
Host: mydomain.com
User-Agent: Mozilla/5.0 (Macintosh; Intel Mac OS X 10.8; rv:20.0) Gecko/20100101 Firefox/20.0
Accept: text/html,application/xhtml+xml,application/xml;q=0.9,*/*;q=0.8
Accept-Language: en-US,en;q=0.5
Accept-Encoding: gzip, deflate
Connection: keep-alive
HTTP/1.1 302 Redirect
Content-Type: text/html; charset=UTF-8
Location: http://mydomain.com/
Server: Microsoft-IIS/7.0
X-Powered-By: ASP.NET
Date: Sun, 21 Apr 2013 15:20:12 GMT
Content-Length: 150
----------------------------------------------------------
http://mydomain.com/
GET / HTTP/1.1
Host: mydomain.com
User-Agent: Mozilla/5.0 (Macintosh; Intel Mac OS X 10.8; rv:20.0) Gecko/20100101 Firefox/20.0
Accept: text/html,application/xhtml+xml,application/xml;q=0.9,*/*;q=0.8
Accept-Language: en-US,en;q=0.5
Accept-Encoding: gzip, deflate
Connection: keep-alive
HTTP/1.1 302 Redirect
Content-Type: text/html; charset=UTF-8
Location: http://mydomain.com/
Server: Microsoft-IIS/7.0
X-Powered-By: ASP.NET
Date: Sun, 21 Apr 2013 15:20:12 GMT
Content-Length: 150
----------------------------------------------------------
and it keeps going until "This webpage has a redirect loop" is displayed

Answer 1

I expect I have to create a new virtual directory for www.mydomain.com and then redirect that to mydomain.com, but that seems awkward.