Users have to select “direct internet connection” on their Email client and
News reader if they want to send anything out. Users can select and use
Proxy to receive everything.

BM3.6EE on SBS6.0 all patched to latest. BM uses NIAS for on-demand
dialup. There are no filtering or access rules in place (no IPFLT, etc.).
HTTP, FTP, and Real Audio are the only Application Proxies enabled. This
is just a singe server office, no mail servers or news servers present.
Users have Email and News clients configured to use port 8080 on the proxy

Do I have to enable the Mail and News Proxies? If so, how, since they
demand Mail and News servers on the Intranet, which do not exist?

I don’t see what I’m missing.