Does name resolution work properly?
Try to connect using localhost to another server process running locally, e.g. activate personal websharing in the sharing control panel and point your browser to localhost. Does it show the famous "it works" page? If not, stick with that. Try flushcache command on your lookupd. Check with your ethernet config using ifconfig and post results here if you cant deal with that on your own. If it is really mysql-specific, then I dont know about the problem.
Christian, the problem is MySQL-specific. The default hostname to connect to a MySQL server is "localhost", and MySQL special-cases the "localhost" hostname, bypasses the entire network stack, and accesses the local MySQL server's socket file directly. Karl's network probably works fine, since he said it works fine when connecting via the server address 127.0.0.1, for which MySQL does no special-casing, does not go directly to the socket file but rather does use the TCP/IP stack.
Correct, localhost works for everything else, such as apache, etc. Is there a configuration setting, or a setting I can set when compiling MySQL to turn off this "localhost to UNIX socket feature". Thanks, Karl