I feel your pain on this. We have a strict security policy in place that limits the number of devices that can talk directly to the internet. Using the on-prem server is vital to staying compliant and still maintaining active registrations for our licenses. With that said, I think the On-Prem server could use some more attention to the technical documentation. There seems to be a lot of vague or incomplete instructions.
The document doesn't tell you what transfer method to use when in the console for patching a System 7 Server. You can simply use WinSCP to transfer the files to the server directory. They leave out the underlying directory in the documentation. Only after you run the command as stated in the documents do you see the path being used for "patches:" which is '/var/files/patches'
TL:DR - Use WinSCP to connect and move the files to /var/files/patches on the on-prem server.
