I had the exact same problem you did and also tried posting my log and questions to the Virus, Trojan, Spyware, and Malware Removal Logs forum, and I’m sorry to say, I have yet to get a reply AFTER A WEEK of waiting.
So, since I HAD to use my computer and and could wait no longer, here is what I did and you could try:
Start Windows 7 in Safe Mode with Networking. Do this by turning off the computer completely, and then turning it back on with the F8 key HELD DOWN THE WHOLE TIME. You should then get a black screen with white letters offering you the option to “Start Windows in Safe Mode with Networking”. Choose this option.
Then, after Windows starts up, click on Internet Explorer and then on “Tools”, then “Internet Options”, then “Connections”, then “Lan Settings” and then see if the box is checked for “Use a proxy server…” and if checked, UNCHECK IT. Then click “OK” at the bottom, and then “OK” again on the next screen to exit IE. Hopefully, you should now be able to get onto the internet as long as the proxy server box is unchecked.
When you get on the internet, go to http://www.malwarebytes.org/
and download the free version of Malwarebytes’ Anti-Malware (MBAM), run it (still in “Safe Mode with Networking”) and it will delete all the viruses it finds. Your computer should be in much better shape by then.
If you need any more help, just let me know. I believe you have some version of the “Antivirus Scan” virus which changed your Internet Explorer Lan options to a proxy server, which is why you can’t get on the internet. Whatever you do, DON’T buy the software this rogue security software is trying to sell you, and don’t believe any of their scare tactics about your programs being “infected” and their fake virus scans.
I also had a “redirect” virus once I got on the internet and I can tell you how I got rid of that, too, if need be, with a different program.
I hope, in the meantime, that you do get some assistance from the Malware Removal Team in the Virus, Trojan, Spyware, and Malware Removal Logs Forum, and don’t mean to interfere with that assistance in any way, but I believe the steps I outlined here would most likely be suggested by the Malware Removal Team as well.
Let me know what happens and good luck.