OS X - can't set root password

[Robert Lund]

I just installed 4.0.15 on an iBook running Mac OS X 10.2.6. I started 
the daemon using bin/mysqld_safe, and then tried to initialize the root 
password as instructed. The first,

bin/mysqladmin -u root password ******

ran apparently successfully. When I tried to execute the second:

/usr/local/mysql/bin/mysqladmin -u root -h `hostname` password ******

the response was:

/usr/local/mysql/bin/mysqladmin: connect to server at 'lazarus.local.' 
failed
error: 'Host '192.168.1.100' is not allowed to connect to this MySQL server'

That is the IP address assigned my Mac by my DSL router; and its name is 
'lazarus'.
Where can I find out the source of this permissions gap and how the 
channel might be opened up?

Thanks

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