Hi Sottwell,
I have uninstalled and re-installed MySQL. I re-created a new database manually and then set the default collation and character set.
When I re run the setup my the character set and collation still comes up blank int the drop down. I have double checked my SQL user has permissions to do anything and everything. I have revisited the server prerequisites page here
http://rtfm.modx.com/revolution/2.x/getting-started/server-requirements in case I have missed something.
!!!!! AHHHHHHHHHHHHHHHHHHHHHHHHHHH !!!!!!!
I haven't configured a remote GUI on my the server so I have been running the install from Internet Explorer on my Win7(64) Workstation.
Reading the browser compatibility list that seems like it shouldn't be a problem.
Just for fun I installed Google Chrome and bingo the Character Set and Collation drop downs are populated.
The rest of the install went through like a breeze.
Thanks and I Hope this helps someone else!
David