local DNS with dnsmasq not working for client

I'm trying to setup my raspberry Pi, running with Ubuntu server 20.04, as a wireless router so I can create a local network behind my raspberry pi.

I'm using hostapd to create a Wifi Access Point and dnsmasq to have a local DNS and DHCP server. The DHCP server seems to work fine: when a client connect (my macbook for instance), it get an IP in the range defined by the DHCP.

But I have issue with the DNS server for local domain name defined in the /etc/hosts. It works fine on the Rasp Pi but not for the client: when I try nslookup gw.wlan from the client shell I got:

Server:     1.1.1.1
Address:    1.1.1.1#53

** server can't find gw.wlan: NXDOMAIN

gw.wlan is defined in the /etc/hosts of the rasp Pi (see below)

Any idea why dnsmask doesn't read the /etc/hosts file ?

It works fine for internet domain name. If I run ping google.fr in the client shell it pings google just fine. Only local domain name are not resolved.

Here are my configuration files:

• /etc/dnsmasq.conf:

# Listening interface
interface=wlan0

# Pool of IP addresses served via DHCP
dhcp-range=192.168.4.2,192.168.4.20,255.255.255.0,24h

# Local wireless DNS domain
domain=wlan

# Alias for this router
address=/gw.wlan/192.168.4.1

# Fix ip for a client
dhcp-host=98:01:a7:95:63:13,192.168.4.2

# Route
dhcp-option=3,192.168.4.1
listen-address=127.0.0.1,192.168.4.1
localise-queries
local=/wlan/

• /etc/netplan/01-netcfg.yaml:

network:
  version: 2
  renderer: networkd
  ethernets:
    wlan0:
      dhcp4: false
      addresses:
        - 192.168.4.1/24

• /etc/hosts :

127.0.0.1 localhost ubuntu
192.168.4.1 gw.wlan
192.168.4.2 jjmac.wlan

# The following lines are desirable for IPv6 capable hosts
::1 ip6-localhost ip6-loopback
fe00::0 ip6-localnet
ff00::0 ip6-mcastprefix
ff02::1 ip6-allnodes
ff02::2 ip6-allrouters
ff02::3 ip6-allhosts

• /etc/resolv.conf :

domain wlan
search wlan
nameserver 192.168.4.1
nameserver 8.8.8.8
nameserver 1.1.1.1

• /etc/systemd/resolved.conf :

DNSStubListener=no