Update dev environment to use jruby-1.7.4

We override the proxy options, as jruby-1.7.4 helpfully imports
the java proxy settings, but fails to pay attention to the proxy
exceptions. This is fixed in later versions of jruby, but sadly
rubygem issues prevent use from going higher than 1.7.4.

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Merge pull request #829 from JamesGlover/switch_dev_to_jruby_174

Update dev environment to use jruby-1.7.4