going to reply to my own post since i finally figured it out, and I saw there were other beginner out there like me who had the same problem.
In order to get terminal to find your commands you have to direct the path to the correct location. In order to do this go into preferences and select "specify complete path:" im on a mac os x 10.4 for me the path is usr/local/mysql
this way the commands were found and everything worked.
Also for beginners to terminal, when you type a password it will seem as tho terminal does not registar that you are typing anything...this is normal. just type the password and press enter. As a safy precaution the typing does not show up on the screen.