well sorry for the last message, one of the problems was pure stupidity by my part, i was bound to a public ip and not a network ip so thats why it wouldnt connect, so this is the latest i get:

root@piper:~# telnet 10.10.1.1 3128
Trying 10.10.1.1...
Connected to 10.10.1.1.
Escape character is '^]'.
^X
Connection closed by foreign host.
root@piper:~#

root@piper:~# telnet 10.10.1.1 80
Trying 10.10.1.1...
telnet: Unable to connect to remote host: Connection refused
root@piper:~#

and the message log:
daidalos@stan:~$ tail /var/log/messages
Jun 16 15:45:32 localhost -- MARK --
Jun 16 16:03:27 localhost kernel: [345347.793942] ip_conntrack: table full, drop ping packet.
Jun 16 16:03:36 localhost kernel: [345356.900819] ip_conntrack: table full, drop ping packet.
Jun 16 16:03:37 localhost kernel: [345357.637898] ip_conntrack: table full, drop ping packet.
Jun 16 16:03:38 localhost kernel: [345358.388780] ip_conntrack: table full, drop ping packet.
Jun 16 16:20:11 localhost squid[16069]: Squid Parent: child process 16071 exited with status 0
Jun 16 16:20:12 localhost squid[16222]: Squid Parent: child process 16224 starte d
Jun 16 16:45:33 localhost -- MARK --
Jun 16 17:03:28 localhost kernel: [348948.681508] ip_conntrack: table full, drop ping packet.
Jun 16 17:03:29 localhost kernel: [348949.431507] ip_conntrack: table full, drop ping packet.
daidalos@stan:~$