I'm pretty sure the function for password encryption is
        PASSWORD('plaintextpw') -- at least that's what I always use and it
        seems to work for me.  ENCRYPT() does something different.  If you
check
        the MySQL documentation, you'll see they always use the PASSWORD()
        function too.

        Also, there are mysqladmin commands and GRANT statements that allow
you
        do to this kind of stuff without raw SQL.  That is preferred,
because
        that way you don't need to worry about which function to use; it's
taken
        care of.

        --Jeremy

I've found that the GRANT works for chaning permissions, but not very well
for creating users.  I would recomment setting up the user, and password
using PASSWORD('yadda') as Heremy suggested, and then use GRANT to adjust
permissions to specific table, dbs, etc.  

Matt
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