We are using 1&1 for the moment using their business level package. We have two databases, one that was installed when we first started this account about 5 years ago. It is version 4, but we also have a database that is MySQL version 5.0.19 which was added when we upgraded our contract type last year. I am told that this new version is the standard version for all 1&1, but it should make alarm bells ring that their support does not seem to know. We did have a problem with the php version so 1.6 initially would not install on 1&1 and Eloy provided the answer in this forum http://moodle.org/mod/forum/discuss.php?d=46400.

Good luck.