OK so you are saying you can access the database by browsing to http://hostname/ and being prompted for the username and password and successfully getting into PHPMyAdmin?
If you are then the problem is most likely with either how you are specifying the details or how the script is trying to use them.
I've looked at the source code. First it gets the database details from the form data POST'ed to the script. Then it writes these to disk in the settings file. Then it attempts to use them to connect to the database.
The settings file is apparently named gig_settings.inc.php - given the steps above, you should check the contents of this file and make sure the database details match exactly what you use to get into PHPMyAdmin. Please let me know if they are blank or not the same.
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