I have a squid server currently running with basic authentication. This is a must because we constantly have different people using different machines but the rules must be set per user, not per machine.

We also have a lot of users coming and going. So every time a new user comes to the office I have to manually create a user for him so he can authenticate.

Anyway.. We do not have any windows servers so no Active Directory. But I need some solution to pass the windows login to Squid.

First question:
It seems I am using NTLM currently for samba as the person can map their home directories on their windows box withuot authenticating. Why can I not use it for squid?

Second question:
Can I make my Centos server into an AD server?

You might heard about ClearOS. This will resolve your all the problems. You can configure this distro as your AD server and it is based on CentOS. I am system integrator and I have installed this at many place. Even you can have control website access of users.

ClearOS has many other features which you might like.