HOTFIX: When you try to open an FTP site by using a Web proxy in IE7, you cannot open the FTP site
When you try to open an FTP site by using a Web proxy in Windows Internet Explorer 7, you cannot open the FTP Web site. This behavior occurs if the Web site URL contains the following entry:
domain\username
You may be unable open the FTP site even after you replace the backslash (\) by using its URL-encoded form (%5c)
http://support.microsoft.com/default.aspx/kb/932562
A comprehensive list of IE7 related Knowledge Base articles can be found here:
http://www.ie-vista.com/kbase3.html