Where do the emails get returned to that are not deliverable when a campaign is sent out?

If they are rejected I think they just bounce back to mailbot at buzzcast.com

Do you know if they are bounced back to the mailbot at Buzzcast - are the addresses for those automatically altered on the subscription list?

Yes they are - they are set to "Inactive" at that time so that you will not try to send to someone who is giving a valid bounce.

Vacation messages DO NOT count as bounces thus we don't set them as 'Inactive'.