To make a proxy repository act like a hosted repo and continue to serve already cached artifacts:
Select the proxy repository in the UI Repositories list. On the Settings tab, check the Block outbound connections on the repository checkbox and Save the settings.
For each repository, edit the Configuration tab. Change Automatically Block to False, and then save.
Immediately right-click the repository in the repositories list and choose Block proxy. This manually blocks outbound connections from the proxy and now Nexus Repository 2 will no longer keep trying to unblock these invalid repositories.