There are plenty of $0 proxy servers out there, so it's probably not worth getting overly excited about this one. If you do a web search for "encrypted proxy", I'm sure you'll find plenty. If you want a VPN provider for free, I would recommend using either FreeVPN.ninja or VPNBook.
Also, if you use a proxy, there's always a possibility that browser plugins might not honor that proxy, thus leaking your real IP address. Since VPNs typically tunnel ALL of your network traffic, whether you programs want that traffic tunneled or not, I think that a VPN might be the way to go for users who use Flash, Silverlight, etc.