I'm not able to reproduce your problem on a fresh lucid install:

$ mysql -u root -pmypwd
Welcome to the MySQL monitor.  Commands end with ; or \g.
Your MySQL connection id is 40
Server version: 5.1.41-3ubuntu9 (Ubuntu)

Type 'help;' or '\h' for help. Type '\c' to clear the current input
statement.

mysql> CREATE USER 'testdb1'@'localhost' IDENTIFIED BY 'testpw';
Query OK, 0 rows affected (0.00 sec)

mysql> GRANT USAGE ON * . * TO 'testdb1'@'localhost' IDENTIFIED BY 'testpw' 
WITH MAX_QUERIES_PER_HOUR 0 MAX_CONNECTIONS_PER_HOUR 0 MAX_UPDATES_PER_HOUR 0 
MAX_USER_CONNECTIONS 0 ;
Query OK, 0 rows affected (0.00 sec)

mysql> CREATE DATABASE `testdb1` ;
Query OK, 1 row affected (0.00 sec)

mysql> GRANT ALL PRIVILEGES ON `testdb1` . * TO 'testdb1'@'localhost';
Query OK, 0 rows affected (0.00 sec)

Could you check the privileges that the root user has?

** Changed in: mysql-dfsg-5.1 (Ubuntu)
   Importance: Medium => Low

** Changed in: mysql-dfsg-5.1 (Ubuntu)
       Status: New => Incomplete

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Access denied for user 'root'@'localhost' to database SOMEDB
https://bugs.launchpad.net/bugs/542543
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