Proxy vs System Users and their Security

I'm coming from a shop that just used the JDE user for the majority of the users to a SQL box.

At my new shop they have 100's of system users, with an AS400 backend. I'm trying to hash out why they did this, and if the Authorization lists for these users on the AS400 side mean anything. The proxy user for all of these is still the JDE user since that's in the ini right? Does the proxy user give the DB access credentials or is that being controlled by Authorization lists on the AS400 side using those system users? We also have a robust Role Security within E1, using QSoft to design, which one takes precedence? A lot of