I just remembered I got this solved recently...
A lot of people (generally a long time ago, so maybe everyone else has solved it anyway) seem to have had a problem with the emulators not being able to create httpConnections when using a proxy server, this is how I've had it solved with Squid.
The issue is that Squid's default configuration denies specific (CONNECT) port access to port numbers other than 443 / 563 (https)..
To solve, you need to get your network administrator to modify the squid configuration:
modify /etc/squid.conf
modify the line:
acl SSL_ports port 443 563
add the port number you want to allow access to ... often 8080 to the end of that line and restart squid..
NOTE: This is a bit of a HACK fix, and you should really create a new "acl" and modify the following line:
# Deny CONNECT to other than SSL ports
http_access deny CONNECT !SSL_ports
to allow access for your new acl
Cheers
Kirk