Not able to connect through Router

In order to have your wireless device assigned an IP address by the wireless router, you must enable DHCP in the WRT54G [DHCP Server] as well as in Windows (it is a Windows service called DHCP Client)... adding a proxy server to the mix complicates this process substantially and so you may need to ask your ISP (Internet Service Provider) or LAN/WAN administrator as to why you must use a proxy server and precisely how to configure your router to find and use it.

Few regular commercial ISPs require proxies but in certain sensitive environments (e.g. law offices/enforcement) they are desirable, so your best bet is to get on the phone with your ISP's or network administrator's tech support staff who can guide you through the proxy settings (or if they set up thousands of customers with proxies, you may find the settings on their Internet site); they can probably also walk you through the rest of any wireless router settings you might need.

Alternatively, I have had surprisingly excellent support from Linksys on that exact same model router and I used to teach Cisco (which owns Linksys) technology. Turned out to be a bad unit, and so was the first replacement they sent! I'm glad I had the knowledge to validate such facts.

Please be aware that if anyone has physical access to your router, they can push a pencil point in its reset-button hole. If that happens you'll have to re-enter all your settings.

The proxy server, correctly identified, should not interfere with running DHCP in that router.

Two other possibilities that may impact your ability to obtain an IP address: not enough addresses are permitted on the router (check its administrative interface from this address: http://192.168.1.1 presuming you know the password; if not, try login name admin and password admin); also in the "Wireless Networks" tab of your Wireless Network Connection window, make sure that "Let Windows manage this wireless connection" is checked (and is unchecked in any third-party wireless utility), unless you've successfully obtained IP addresses using the third-party utililty in the past.