So, in our environment, we have several segregated networks. Each has their own (squid) proxy server and none have previously had issues with automatic updates. All were supposedly set the same way, with the proxy being pushed through group policy. The gpo was set to only push the proxy to normal users and not members of the IT team, mainly because we just don’t like having it. Anyway, there is one network that could not get the microsoft update web page to load. When we looked at the proxy, it looked as though it was redirecting the page to a null site. The reason it was only affecting the one network was: The other networks have the ability to bypass the proxy if the page didn’t load and it wasn’t listed as blocked, whereas this particular network was forced to have all traffice through the proxy. The key to making it work was one simple command:
proxycfg -p <your proxy>:<proxyport>
That sets your proxy info, now you need to restart update services for it to really make a difference:
net stop wuauserv
net start wuauserv
Anyway, I know this is a simple little post, but hope it helps someone.
UPDATE (9/17):
For Vista/Server 2008 use this command instead of proxycfg:
netsh winhttp set proxy [myproxy]:[myport]
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This page called Unblock Websites also has some good information on the subject.