If you ever need to create a database from the command line.. here is how to do it:
(as an aside, a nice quick list of commands is available here)
First login to mysql as root:
mysql -u root -p
MySql will promt you for a password.. Enter it now.
Now simply type:
CREATE DATABASE databasename;
Now create a user for this newly created database:
GRANT ALL ON databasename.* TO 'username'@'localhost';
set the password for this user
UPDATE mysql.user SET password=PASSWORD('password') WHERE user='username';
now to activate the permissions..