Nginx as reverse proxy for Google App Engine application

Any redirect to localhost doesn't make sense from a remote system (e.g. client's Web browser). So the rewrite flags permanent (301) or redirect (302) are not usable in your case.

Please try following setup using a transparent rewrite rule:

location  /foo {
  rewrite /foo/(.*) /$1  break;
  proxy_pass         http://localhost:3200;
  proxy_redirect     off;
  proxy_set_header   Host $host;
}

Use curl -i to test your rewrites. A very subtle change to the rule can cause nginx to perform a redirect.

MQTT needs the stream protocol so you need to separate your HTTPS and stream configurations. Something like this should do it:

stream {

    upstream mqtt_backend {
         server mysite.iot.us-west-1.amazonaws.com:8883;
    }

    server {
        listen 8883; # (tcp)

        location / { 
           proxy_pass mqtt_backend;
        }
    }
}

http {
    upstream gcp_backend {
         server mysite.appspot.com:443;
    }
    server {
        listen 443;
        #proxy_pass gcp_backend;

     location / {
        proxy_pass mysite.appspot.com:443;
      }
    }
}

Also to listen over ssl you would need to enable ssl and have certificates installed or you will get a protocol error. You would at least need:

    server {
        listen 443 ssl;
        ssl_certificate /etc/letsencrypt/live/example.com/fullchain.pem;
        ssl_certificate_key /etc/letsencrypt/live/example.com/privkey.pem;

        ...
    }

and probably:

server {
    listen 8883 ssl; # (tcp)
    ssl_certificate /etc/letsencrypt/live/example.com/fullchain.pem;
    ssl_certificate_key /etc/letsencrypt/live/example.com/privkey.pem;

    ...
}