probably you need to restart mysqld to activate your changes
try "service mysqld restart" on your sme box prompt
after creating , giving permissions and so.
as additional info:
Many mysql related db appliations are provided with some "file.sql" containing he whole instructions (automated) to create the database, tables, permissions, connections etc between "app" and mysql.
this file can be copied into sql section of "phpmyadmin" to get everything done.
then restart de daemon (mysqld) and that's it.