The best way to visualise how the NGINX proxy works is:
example of http access direct to home assistant core (no addons involved):
curl -v http://homeassistant.local:8123
* Trying [my.local.ipv4.address]:8123...
* Connected to homeassistant.local (my.local.ipv4.address) port 8123 (#0)
< Server: Python/3.11 aiohttp/3.8.4
which tells us that we are talking directly with the home assistant server.
NGINX is NOT involved when accessing http on port 8123.
Now we contrast that with an
example of https access via NGINX proxy:
curl -v https://MYHOST.duckdns.org
* Trying my.external.ipv4.address:443...
* Connected to MYHOST.duckdns.org (my.external.ipv4.address) port 443 (#0)
< Server: nginx
which tells us the https website on port 443 is being served/provided by the NGINX proxy addon.