mysql install prob - localhost - server name

[admin]

I just finished installing MySQL on a Cobalt RaQ,

I installed in /home/mysql , due to partitions on this server,

anyway

it is up and running but i have to login as 'server.name.com ' instead of localhost,

When I checked the documentation it said to check /etc/hosts for the line

'127.0.0.1 localhost'

which it has,

any ideas how to fix this?

thanks