Sorry, localhost is an IP address and is not relevant. It is the referrral of a service within the same VM that can cause it to hang if goes through the web server valve.
Precisely my point. localhost is really irrelevant; the point is, the SoapProxy should not freeze a deployment, no matter if the service lies on the same server or a different server.
And additionally, it should be tolerant when the proxied service is up or down.