What is the WinHttpAutoProxySvc ?
Is it involved in the Windows Updating system?
Is it ever used in any way if there is no proxy server?
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This service is what provides the autoproxy service in Windows. If you are not using proxy autoconfig, then you can safely disable this service.
As the name suggests, this utility provides the autoproxy service in a Windows Server installation. It’s really only relevant to you if you’re using automatic proxy configuration. Otherwise, you can safely disable it. If you have additional questions, I'd check out Everything You Need To Know About WinHttpAutoProxySvc.