This is exactly the same in the video.
What ever the domain or subdomain or subdirectories, you written that you create a fresh slave site with a new Joomla installation using MySQLi.
This is what you can see in the video.
Change the domain name value does not change the creation of the slave site and the deploy directory does not change also the configuration.
This just demonstrate the the MySQLi ping function and the other "select" error that you report with the Joomla 1.6 library does not appear with our hosting company using cPanel.
Create and addOn Domain or a subdomain in cPanel with a "document root" give exactly the same result.
The database connection parameter is the one that you provide in Joomla Installer and not in JMS Multisites.
This is what is demonstrated with the Video and that the DB connection is correctly save and used by the slave.
If you want that we investigate on your server, we have a billable support that you can order at
www.jms2win.com/en/joomla-multisite?page...35&category_id=1