We use a proxy configuration script inside the network to download proxy server settings and configure the browser automatically:
Tools / Internet Options / Connections / LAN Settings / 'Use automatic configuration script'
If this is enabled and Internet Explorer is working correctly (i.e. web browsing access via the proxy server works), the Paint.NET 'Check for Updates' feature returns the following:
There was an error checking for update.
The server returned the following error code: HTTP 407 (ProxyAuthenticationRequired)
No unauthenticated HTTP access is allowed outbound, so a proxy server setting is required, however, Paint.NET does work successfully if a manual proxy server is specified in Internet Options.