Thanks for the responding Natalie.

1. The domain in question is applied with group policy and forced on each 
login. So, the user has the ability to remove the setting locally each time, 
but that would be a nussiances. Actually, it does not work in IE8, either. But 
currently, IE7 is the corporate standard. However, I am addressing IE8, with 
its rollout.

1a. It works in all other browsers not management by any policy. So, this rules 
out the proxy.pac.

2. Yes, we can put in the local intranet which has med-low security setting, 
but the issue it is current in trusted site. (in our environment with many 
applications to consider, removing it will be an issue, as the impact cannot to 
gauged, especially for critical apps.)

The solution i can think of,

1.  is new domain. Which will be alot of work 
2. have users install non-standard browser, which group policy don't control. 
3. users go directly to http servers, behind bigip (worst solution, but still 
one)

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