I think that what MLB is doing is if Silverlight is installed, it is using it so when you uninstall it, its using their older Flash-based player. There may be a bug with teh Proxy auth in Silverlight, perhaps someone with more video expertise will chime in.
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Shawn Wildermuth
C# MVP, MCSD, Speaker and Author
Silverlight 2 Workshop
May 12-14, 2008 - Atlanta, GA
May 28-30, 2008 - San Francisco, CA
http://www.silverlight-tour.com