further I ensured that the port fiddler is listening on is 8888 by performing the steps below.
Tools > Fiddler Options > Connections then change the port listed within the "Fiddler listens on port" setting to 8888.
ARR's proxy entry is pointing to 127.0.0.1:8888.
I can clearly see https decrypted traffic and also the http traffic originating from ARR. Like I said the hostnames in case of rewritten HTTPS requests are not correct and I get the server pipe error and it falls back to the original host name