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				Failed to connect to database: Error: Can't connect to mySQL server on 'localhost' (10061)
			
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mysql isn't running, or db.ini has the wrong information.
Also from the readme:
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				4. Now is the moment of truth (time to run it and see if it works!) 
 
In the EQEmu Directory run "world.exe"  
A window should pop up saying : 
 
LoginServer.ini read. 
Using database 'eq' at localhost 
Loading items...done. 
Loading guild ranks...done. 
World server listening on: YourIP:9000 
Connected to LoginServer: eqlogin.eqemu.net:5999 
 
If you receive a message saying Access Denied blahblah@localhost blah blah error. Try running Winmysqladmin.exe in the background.  
If that does not work reboot your machine 
 
And if that does not help. Open mysql.exe ( found in c:\mysql\bin ) 
Type in: GRANT ALL PRIVILEGES ON *.* to '%'@localhost IDENTIFIED BY '%'; (press enter) 
Close out of mysql.exe 
 
IMPORTANT NOTE: CONTINUE ONLY IF THERE ARE NO ERROR MESSAGES 
IMPORTANT NOTE: CONTINUE ONLY IF THERE ARE NO ERROR MESSAGES 
IMPORTANT NOTE: CONTINUE ONLY IF THERE ARE NO ERROR MESSAGES
			
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 If you get an error, stop and figure it out.  Trying to continue only confuses the issue.  And make sure you looked back and find the FIRST error.