ITunes/iPhone update and Authenticated proxy support

Itunes Iphone update fails to use username with proxy when trying to POST to http://gs.apple.com/TSS/controller
It is quite obvious that this is an Itunes bug, it is useing the proxy and will also use authentication for some portions of the process.
This happens with Iphone 3GSs and iOS 4.3.2 and Iphone 3Gs with iOS 4.2.1 iTunes 10.2.2.12, updates work fine with no proxy and normal itune functions like song buys, radio listening etc... are fine.
1304023961.676      0 172.20.55.84 TCP_DENIED/407 1793 GET http://itunes.apple.com/version? - NONE/- text/html
1304023961.687      6 172.20.55.84 TCP_DENIED/407 1988 GET http://itunes.apple.com/version? - NONE/- text/html
1304023961.957    270 172.20.55.84 TCP_MISS/302 421 GET http://itunes.apple.com/version? srough DIRECT/74.203.241.9 -
1304023962.428    181 172.20.55.84 TCP_MISS/302 407 GET http://ax.itunes.apple.com/check/version srough DIRECT/74.203.241.33 -
1304023962.442      7 172.20.55.84 TCP_DENIED/407 2039 GET http://ax.itunes.apple.com/WebObjects/MZStore.woa/wa/com.apple.jingle.appserver. client.MZITunesClientCheck/version - NONE/- text/html
1304023962.452      7 172.20.55.84 TCP_DENIED/407 2234 GET http://ax.itunes.apple.com/WebObjects/MZStore.woa/wa/com.apple.jingle.appserver. client.MZITunesClientCheck/version - NONE/- text/html
1304023962.764    305 172.20.55.84 TCP_MISS/200 39140 GET http://ax.itunes.apple.com/WebObjects/MZStore.woa/wa/com.apple.jingle.appserver. client.MZITunesClientCheck/version srough DIRECT/74.203.241.33 text/xml
1304023978.242    173 172.20.55.84 TCP_MISS/302 416 GET http://itunes.apple.com/version? srough DIRECT/74.203.241.9 -
1304023978.257      2 172.20.55.84 TCP_DENIED/407 1817 GET http://ax.itunes.apple.com/check/version - NONE/- text/html
1304023978.267      7 172.20.55.84 TCP_DENIED/407 2012 GET http://ax.itunes.apple.com/check/version - NONE/- text/html
1304023978.334     62 172.20.55.84 TCP_MISS/302 412 GET http://ax.itunes.apple.com/check/version srough DIRECT/74.203.241.33 -
1304023978.618    283 172.20.55.84 TCP_MISS/200 39135 GET http://ax.itunes.apple.com/WebObjects/MZStore.woa/wa/com.apple.jingle.appserver. client.MZITunesClientCheck/version srough DIRECT/74.203.241.33 text/xml
1304023991.944      5 172.20.55.84 TCP_DENIED/407 1802 POST http://gs.apple.com/TSS/controller? - NONE/- text/html

I am experiencing the same issues, my ipad doesn't download any apps anymore.
The ipad 1 only had this problem on third party apps, now it doesn't work on Apple Apps to...
Can Apple please respond to this issue ?

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