The basic idea is that the client has to make multiple connections to
the server.  The server needs to keep a session open along with a socket
connected to the MUD that does all the telnet negotiation, and which
sends output out along the main HTTP connection as streaming XML.

Unfortunately, Firefox wouldn't cooperate.  It seems to only try to
parse the results after enough bytes have come through, so even getting
the introduction screen working was a failure.  The proxy received the
data and sent it to the browser, but Firefox refused to make the data
available to JavaScript for parsing.

There might be some way to force Firefox to behave the way I need, but I
haven't figured it out yet.

There's still then the input issue.  The proxy needs to support taking
other connections, testing to see if they are input requests, looking up
the appropriate session, and sending the input in.  Clients have to be
very careful on how they handle input submission to ensure that all
input goes in the right order; if a client makes two separate HTTP
requests, the one which the client started second might complete first,
causing input to the MUD to be out of order.

I don't know if I can get this to work or not, but it's something I plan
on playing around with in my spare time.