I'm a new Rails Developer, and I'm working on a legacy Rails app. Whenever I run the rake db:create command, I get an error that the database couldn't be created. I have found many StackOverflow questions related to this, but in troubleshooting nearly all permutations of solutions, I couldn't resolve the issue.

I created the three Dbs (dev, prod, test), created the user with all access privileges to these dbs, and ran rake db:create.

I'm running Mac OS X Lion, MySQL 5.5.28, Rails 2.3.5, Ruby 1.8.7. Here are my settings

development:
  adapter: mysql
  encoding: utf8
  database: adva_development
  username: adva
  password: ****
  host: localhost
  socket: /tmp/mysql.sock

Here's the error:

Couldn't create database for {"adapter"=>"mysql", "username"=>"adva", "host"=>"localhost", "encoding"=>"utf8", "database"=>"adva_development", "socket"=>"/tmp/mysql.sock", "password"=>"****"}, charset: utf8, collation: utf8_unicode_ci (if you set the charset manually, make sure you have a matching collation)

I have done the following troubleshooting:

1. Verified user and password are correct, and the user has access to the DB. (Double checked user access with SELECT * FROM mysql.db WHERE Db = 'adva_development' \G; User has all privileges.)

2. Verify the socket is correct. I don't really understand sockets, but I can plainly see it at /tmp/mysql.sock.

3. Checked collation and character set. I found out I had created the DB in latin charset and collation, so I recreated them. I ran show variables like "collation_database"; and show variables like "character_set_database"; and came back with utf8 and utf8_unicode_ci respectively.

4. I followed the instructions in this question. After uninstalling mysql gem, I ran the following but came up with the same error:

   gem install --no-rdoc --no-ri mysql -- --with-mysql-dir=/usr/local/mysql-5.5.28-osx10.6-x86_64/bin --with-mysql-config=/usr/local/mysql-5.5.28-osx10.6-x86_64/bin/mysql_config 
   

5. Following Matt's suggestion, here's what a rake --trace db:create reveals:

   ** Invoke db:create (first_time)
   ** Invoke db:load_config (first_time)
   ** Invoke rails_env (first_time)
   ** Execute rails_env
   ** Execute db:load_config
   ** Execute db:create
   Couldn't create database for {"database"=>"adva_development", "adapter"=>"mysql", "host"=>"127.0.0.1", "password"=>"woof2adva", "username"=>"adva", "encoding"=>"utf8"}, charset: utf8, collation: utf8_unicode_ci (if you set the charset manually, make sure you have a matching collation)
   

After 3 days and six or seven hours, I have pretty much run out of options. I tried various random things, like replacing localhost with 127.0.0.1 to no avail.

Could there be something wrong related to my specific environment? Mac OS X Lion + MySQL 5.5.28? I plan on trying on setting up everything in a Linux environment.

Thanks!