Hi @rlev,
This issue appears to be unrelated to ssh domain name.
I looks like it is more likely something to do with network configuration on either host instance or remote device.
I believe 172.18.0.6 is the IP of address of your remote device running Balena host OS? The first thing I would do is start using some network tools like telnet to check that your Balena instance can reach the device at that IP and then check if there is anything listening on that port.
$ telnet 172.18.0.6 3128
Cheers
Chris