opps! its 12.1, my apologies,
can you check it under
C:\ProgramData\Symantec\LiveUpdate
it will be log.liveupate, you can open this file in notepad, does it say anything about proxy?or authentication issue, please attach that file..
Did you run luall.exe ? what was the result?
the reason I'm asking is, when you run luall.exe from start - run, liveudpate will run on your account, so anything with respect to proxy or firewall will be displayed here,
something like this one
How to verify SYSTEM account proxy settings
http://www.symantec.com/business/support/index?page=content&id=TECH146632