The proximity line is a signal from the plug to the EV. In general, the proximity signal is not used by the EVSE and some J1772 plug/cable sets don't even have a proximity wire. The proximity line is a resistance to ground that changes when the latch button on the handle is pushed. The EV is supposed to recognize this change in resistance and shut down the current draw in preparation for the plug to potentially be pulled out. The specification requires a response within 100 ms to a proximity transition, but allows far longer to respond to changes in the pilot signal - long enough that someone could yank the plug out, causing arcing if current was still flowing.
The pilot line serves several purposes. First and foremost, there is a +/- 12 volt square wave with a 1 k-ohm impedance supplied by the EVSE. The duty cycle of the square wave is the indication to the EV of how much current is available. The EV is not allowed to draw more than the pilot indicates, and must respond dynamically to changes in the pilot while charging. The EV places variable resistance between the pilot pin and ground through a diode. The different resistances constitute states. The allowable resistances are 2.7 k-ohm, 882 ohms and 240 ohms, which reduce the +12 volt level to 9 volts, 6 volts and 3 volts respectively. The negative portion of the pilot's travel is protected by the diode and remains -12 volts. The presence of the square wave constitutes an "offer" from the EVSE to the EV. The 9 volt level indicates that the EV is present, the 6 and 3 volt levels indicate an acceptance of the "offer", and cause the EVSE to turn on the relay which powers up the hot lines. The 3 volt level differs from the 6 volt level in that it indicates that the EV is charging lead-acid batteries that require ventilation in order to charge safely. If the EVSE is not located outside or has no way to turn on a ventilation fan, it must refuse to offer power. No production EV currently available uses the "vent required" signal, and most EVSEs refuse to charge (outdoors or not) with it.
If the negative portion of the square wave does not stay at -12 volts, that is an indication of a missing diode, which will (or rather, should) cause an error and prevent charging. The idea is to prevent the proverbial "bucket of mud" that the plug might fall into that happens to have an 882 ohm resistance would not cause the power to come on. Only an actual electronic circuit connected deliberately will have both the correct resistance and a diode. And since the resistance and diode must be connected to ground within the EV, it verifies that the ground circuit path from the EV to the EVSE is unbroken.