iTunes' clandestine proxy settings

"Found it! iTunes.exe was apparently incorrectly enforcing disabled proxy settings from Mozilla Firefox, but only for iTunes Store connections.

In the affected user's prefs.js, the following was specified:

user_pref(""network.proxy.http"", ""172.31.1.1"");
user_pref(""network.proxy.http_port"", 8080);
user_pref(""network.proxy.ssl"", ""172.31.1.1"");
user_pref(""network.proxy.ssl_port"", 8080);

However, network.proxy.type was implicitly set to its default value of zero, meaning ""don't use a proxy."" I don't know if iTunes was calling out to the user's default browser (Firefox), partially parsing the prefs.js settings itself, or what.

In any case, I removed these settings via about:config, and all is well.

Thanks for all the suggestions, and thanks most to a sysadmin friend who suggested I search through the filesystem as well, rather than the just the registry."

Have you tried using iTunes while logged on as a different user on that computer? Perhaps the proxy setting is stored in the user profile and all you need to do is create the user a new profile on the computer.