Right you are. However that's a recent change made while very tired. Earlier attempts had it correctly as :

$ENV{HTTP_PROXY} = "http://$username:$password\@192.168.1.10:8080";
[download]

Unfortunately, I get the same result whether the quotes are correct or not. If it were simply a matter of bad credentials, wouldn't I get a different error? (not the 502 Proxy error)