That's better now it is much clearer to see your issues.
The confusion you are experiencing seems to be caused by the terms local and remote.
Local and remote in your case are the same because you have selected to edit and test locally then upload the finished site - mysite.net does not come into the equation until you are ready to upload your site to a hosting provider.
(I found the Advanced Tab was easier to figure out).
The address should be:
Because you will edit and test locally and then upload the completed web site to your hosting provider.
Editing Files Part 2 and Part 3 are correct.
Because you are testing locally...
The folder should be:
Testing Files Part 2
The address should be
and should be tested when Apache and MySQL in XAMPP are started - you should get the success window.
(Unless, of course, you have a VirtualHost configuration set up in xampp\apache\conf\extra\httpd-vhosts.conf file for your mysite.net domain to run locally which would require a different configuration in DW).
The reason you are getting a success window testing the mysite.net:80 address is DW is going to your domain name mysite.net hosting provider web site and not to your testing server site which is localhost in XAMPP.
The above is one of those confusion issues - forget about mysite.net in this configuration because you are editing and testing locally then uploading a completed and tested web site to your mysite.net hosting provided service (via FTP perhaps).
MySQL Image 1
In all these DW MySQL Windows the Help button has a detailed explanation for the entries required.
(you can leave the database settings in phpMyAdmin to Any host or you can revert them to localhost, your choice).
Connection name: accers
Only a DW requirement
MySQL server: localhost
You don't have a server defined in XAMPP for mysite.net even though Any host is configured.
Stick to localhost for this exercise or use the loop back IP 127.0.0.1
Make sure this and the password are correct for the database name you will provide below.
This has to be the name of the database you created for your website in phpMyAdmin.
If MySQL is started then when you click on Select a database and if the above credentials are correct then DW should be able to connect and give a list of databases to select from that the above Username and Password are associated with.
If the details in the MySQL windows are incorrect then you will be presented with a 2003 error, which you have already experienced.
Anything you don't understand after trying the above then I will see if I can clear the fog - I have DW and can simulate you issues.
Now you can realize that to help you, all we need is clear and concise details, as no one here can see your screen or know what you have done or what you intend to do unless you give as much detail as possible about an issue.
Try and brake up your post into readable sections by separating each sentence with a carriage return, instead of, like your first post, just one big jumbled up paragraph which is very difficult to read.
I hope this is helpful and you get it working and can move forward but please realize that topics related to DreamWeaver are not 'on topic' in these XAMPP forums and may be deleted by any competent forum Moderator.