The best proxy software i've found so far is FreeProxy by HandCrafted Software.
You can get it from their site.
Install it on the machine you want to use as a proxy.
Next, run the "FreeProxy Control Center" through the Start-menu. Double-click on the first item called "Internet" (type Port).
Change protocol to "SOCKS 4/41/5 Proxy".
Make sure you check all three boxes under "SOCKS options".
Press Done. A security question will pop-up, just answer Yes. You will set a username and password next so nobody else from outside may use your proxy.
Double-click on "Users".
Select "Users", and click on Add. Type in some username and password and click Done, then Done.
Next, choose File/Save, Then click on Start/Stop and choose "Start FreeProxy as a Service".
This will install FreeProxy so it always start with Windows.
If you wish to run just for a session, choose "Start FreeProxy in Console Mode", then you can just turn it off when you're done.
That's it. Now just use SocksCap32 or something similar and run through your proxy!
Setting up Proxy-server to use with Battle.Net
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