MySQL -- preconfigured?

I've just installed 1.4 to a machine and as I understand it, it
installs with one user, 'root'@'localhost'.

In phpMyAdmin, I see that the config.inc.php file, I can see this is
specified -- root, no password, localhost (and I tried 127.0.0.1 as
well).

However, when I go into phpMyAdmin (from configure- database (via
phpMyAdmin) I get:

#1045 - Access denied for user 'root'@'localhost' (using password: NO)

Similarly, if I try going into MySQL, I get:

C:\InstantRails\mysql\bin>mysql
ERROR 1045 (28000): Access denied for user 'ODBC'@'localhost' (using
password: N
O)

C:\InstantRails\mysql\bin>mysql -u root
ERROR 1045 (28000): Access denied for user 'root'@'localhost' (using
password: N
O)

Now, all I am trying to do is set up a new user by submitting the
following commands:
grant all on *.* to ggrip@'%' identified by "xfiles";
flush privileges;
set password for ggrip@'%'=OLD_PASSWORD('xfiles');
flush privileges;

My problem is, I cannot get into the database no matter what I seem to
do -- it wont seem to recognise root with no password on localhost. Can
someone please tell me what I am doing wrong here. Thanks.