Totally agree with Jeff. A good set of test data is priceless. It's also expensive to set it up. I've set up realistic test data for demo websites to the point that they want to see aggregate data improve over time. You know, just so that the client can see that things will definitely get better!
To make test data realistic is very difficult and time consuming and I've always used real data as the basis for the test data.
We set up a very useful function on our development website where the internal tester can see the external mail addresses in the notification emails. The dev web application effectively only uses our domain email addresses and adds the external email addresses to the end of the email for reference. When testing the internal client can see which external client would have received the emails so they can be sure the right people will be notified on the live site.