I believe you're seeing this error message because you're trying to run Microsoft's Internet Connection Sharing (ICS) service on the same computer that's running your name server. ICS automatically starts a DNS proxy (the one mentioned in the error message) to relay local clients' DNS queries to the Internet. But the DNS proxy listens on the same UDP and TCP ports that the name server uses, which is a no-no in TCP/IP networking. So you'll have to disable ICS on this computer to make the error go away.
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