When another proxies use the WSA as proxy (upstream proxy) then the explicit request processed aren't different from explicit request that are made from clients directly. So in theory all should work. For the WSA point of view, your squid proxy will look like a "single" client doing all request. It depends on squid how much information it forwards, especally on request like HTTPS, it might only forward an connect request towards the already resolved IP address which makes it difficult for the WSA to identify or match certain policies.
Within your aclogs you should be able to identify why certain policies have not matched (e.g. decryption policy).
Generially speaking, WSA as upstream proxies are known scenarios but also include some "natural" limitations.
