While browsing the Google App Engine application gallery , accidentally I came across one interesting app. Its called Calyphrox WebProxy. It a proxy server hosted on Google App Engine. Since this app is hosted on Google App Engine, it can take advantage of Google's enormous bandwidth and scaling capabilities.
I only wish if this app would have been open sourced then anyone could have built an proxy server within minutes. May be someone would do it someday. Let's hope so.