I need to setup some type of whitelisting proxy. What I would like to do is have clients authenticate with a username/password, then they would only be allowed to access websites that I have whitelisted. I would also like an administrative interface so I can easily modify the list of whitelisted sites. Right now, I think the path I need to take is Squid + Webmin.

My concern is that Squid does too much. For example, I do not want any pages cached. Can I simply set the cache size to 0 in squid to avoid this? Is there a better alterntive that will provide a simple whitelist that is easy to manage? I've been reading the Squid docs, but any good HOWTOs would be appreciated.

Yes, you can tell Squid not to cache anything. It does as little or as much as you want - the authentication is fairly easy against other network systems or just on your local Linux box, and the whitelists are easy through the Squid ACL's, which are well documented in their FAQ's.