wsstudios.dreamhost.com is the valid domain name in DH system. Therefor you can create hostname like mysq.wsstudios.dreamhost.com for your mysql server.
After you transfer your site to DH, you will see your domain name in the drop down menu. You can then create hostname like mysql.yourdomain.com for your mysql server.
And of course, you can use those databases. You can also create unlimited database as DH promises.
I think you may need this article when you transfer your site to DH.
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