Oracle adheres to the official rules in the RFC for FQDN (Fully Qualified Domain Names)
If I recall correctly hyphens are allowed and underscores are not allowed.
You would need to use Wikipedia to find the rules for a FQDN.
Thanks for that Sybrand. I've checked out what you pointed me and it does say that hyphens are allowed.
However, I've just found a conflicting document on Metalink (sorry, MyOracleSupport) Doc Id 477993.1 whereby it causes problems with Siebel environments. It says the following:-
"The hyphen (-) or dash characters are not permitted as valid characters within the Siebel server name. The only valid characters that can be used in the Siebel server name are alphanumeric and underscore characters. Configuring a machine hostname that contains a hyphen character can also cause certain behaviors when running the Siebel Server Configuration Wizard"
So, it's still a bit unclear. I think what I'll do is raise an SR to double-check.