Still having some issues here. I have had my proxy settings upgraded and I can now login to servicecenter from my work PC but getting service studio to login using the same login settings is proving unreliable. I get host not found most of the time. Is it time to upgrade service studio to 126.96.36.199 as suggested earlier. I did stop and start my amazon instance to see if changing the public DNS would cause problems but its OK.
I have tried with the proxy settings in service studio and without.