Inside Arduino software go to file->preferences and then select the check box of "show verbose output during: compilation "
now you will see the .hex file's path inside black window at bottom of software.
secondly no need to place ATmega 328 in proteus download the libraries i've attached.. extract it and paste it in to
"C:\Program Files\Labcenter Electronics\Proteus 7 Professional\LIBRARY"
now you can place arduino board in proteus directly.
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