Hi,
I had exactly the same issue, testing the connection was ok, but the collation dropdown list remained empty.
After hours of changing setups and versions I decided to create the MySQL database by hand (just a simple create database click in phpmyadmin).
After that running the MODx setup again, if testing the connection was oke, the actual setup began, skipping the collation selection as this is at this point needed for creating the database which it didn’t had to do anymore.
Hope this helps for you!
Kind regards,
Maurits, The Netherlands