I configured "Proxy1" as 127.0.0.1:8080
I selected "Proxy1" from the Tools->proxy menu.
Then change back to "Direct Connection".
But k-meleon is still using 127.0.0.1:8080 as proxy, although from the proxy menu "Direct Connection" is checked.
Can someone else confirm this behavior?
Do you know how to fix this?

It is the flash plugin which insist on using IE's setting which use the proxy.
Shouldn't the flash plugin respect k-meleon's proxy setting?

Flash plugin is alittle independent about the browser.
Check this pref value in about:config:
http://kb.mozillazine.org/Network.proxy.type

K-Meleon in Spanish