Working in Microsoft Developer Support, I have seen a few cases where large PAC files generated by tools supplied with Netscape Proxy Server will cause Internet Explorer to fault intermittently when navigating to certain sites. While the precise cause of these faults has not been established at the time of this writing, it can be fixed in most cases by removing the large block of comments inserted at the top of the file by the Netscape tools.
In general, your auto-proxy file should be as small and efficient as possible-tight coding and uncommented production code should result in problem-free PACs. I always keep a commented version of the PAC file in my development environment, but remove the comments from the file I place on the server.
The following Knowledge Base articles describe other known issues with auto-proxy files in Internet Explorer:
Q196133 Autoproxy Script Fails if Using Unknown JavaScript Command:
http://support.microsoft.com/support/kb/articles/q196/1/33.asp
Q194961 Windows Scripting Host Breaks Autoproxy of Internet Explorer 3.0:
http://support.microsoft.com/support/kb/articles/q194/9/61.asp
Q187772 Proxy 2.0, Internet Explorer 3.02: “Unexpected error”:
http://support.microsoft.com/support/kb/articles/q187/7/72.asp
Q189057 Err Msg: Internet Explorer Cannot Open the Site
Q181856 PRB: Internet Explorer Now Has Support for Alert():
http://support.microsoft.com/support/kb/articles/q189/0/57.asp
http://support.microsoft.com/support/kb/articles/q181/8/56.asp