Oh man, how good it feels to see my dumb little label display "connected." The issue was 100% with mysql. I totally reinstalled 4.0.25 (I didnt want to mess with the new passwords of 4.1). I dont know what configuration option was wrong but the "-skip-networking" switch was not in the mysqld_start file. From what Ive read thats all that turns off the TCP connections. Either way, if some reader has debian/ubuntu, DONT use the apt-get mysql package. I grabbed the linux binary from mysql, dumped it in and all was good.
*sigh* I can sleep now.
Ben