And this is my attempt to test it manually from the cmd line. Still on the machine running mysql and with the env. variables set:

\SWARCH~1\PERL\Class-DBI-mysql\Class-DBI-mysql-1.00>nmake test

Microsoft (R) Program Maintenance Utility   Version 1.50
Copyright (c) Microsoft Corp 1988-94. All rights reserved.

        C:\Perl\bin\perl.exe "-MExtUtils::Command::MM" "-e" "test_harn
+ess(0, 'blib\lib', 'blib\arch')" t\mysql.t t\pod-coverage.t t\pod.t
t\mysql...........ok 8/8Attempt to free unreferenced scalar: SV 0x1c47
+6a0, Perl interpreter: 0x2240dc at C:/Perl/lib/Test/Builder.pm line 1
+329.
t\mysql...........dubious
        Test returned status 5 (wstat 1280, 0x500)
        after all the subtests completed successfully
t\pod-coverage....skipped
        all skipped: Test::Pod::Coverage 1.00 required for testing POD
+ coverage
t\pod.............skipped
        all skipped: Test::Pod 1.00 required for testing POD
Failed Test Stat Wstat Total Fail  Failed  List of Failed
----------------------------------------------------------------------
+---------
t\mysql.t      5  1280     8    0   0.00%  ??
2 tests and 2 subtests skipped.
Failed 1/3 test scripts, 66.67% okay. 0/8 subtests failed, 100.00% oka
+y.
NMAKE : fatal error U1077: 'C:\WINDOWS\system32\cmd.exe' : return code
+ '0xff'
Stop.
[download]

It looks like it's nearly working but not quite.