Ok.
Running MySQL on windows you shouldn't need to grant these privileges. They are set as default when you install MySQL. If your running PHP MySQL & Apache to test out scripts locally you shouldn't need to add a new user.
Connect to MySQL using the following the details below - note that there are NO arguments in the mysql_connect function.
<?php
$link = mysql_connect();
if (!$link) {
die('Could not connect: ' . mysql_error());
}
echo 'Connected successfully';
?>
I had to work this out the hardway although it is mentioned in the MySQL manual(but doesn't state what goes in mysql_connect last time I looked--their site is very slow for me today will check again later ).
Make sure MySQL Admin is running and the traffic light is green in your system tray :0)
Let me know you how you get on and mark this thread as resolved if thats the case.