First of all I must say that Ketarin is a really good tool:
I use ketarin@home without problems and now I'm trying to use it at office too.
At office we have a squid proxy with NTLM (and basic) authentication support.
The authentication parameters work with any browser we tried (IE,FF,Safari,Opera,Chrome,K-meleon) and some other programs too.
For auth we use:
username: <DOMAIN\user> (case insensitive)
password: <passsword>
It seems that Ketarin doesn't work with proxy+auth set.
The response is 407 (proxy auth required) for all the requests.
Thanks a lot.