Authentication issue with Keystone

I have my keystone, nova, dashboard set-up running using the latest trunk but I consistently run into this HTTP 401 error:

DEBUG:django_openstack.api:auth_api connection created using url "http://localhost:5000/v2.0/"
ERROR:django_openstack.auth:Error authenticating: Unauthorized
Traceback (most recent call last):
  File "/home/somik/openstack/dash/django-openstack/django_openstack/auth/views.py", line 45, in handle
    data['password'])
  File "/home/somik/openstack/dash/django-openstack/django_openstack/api.py", line 612, in token_create
    return Token(auth_api().tokens.create(tenant, username, password))
  File "/home/somik/openstack/dash/openstack-dashboard/.dashboard-venv/src/openstackx/openstackx/auth/tokens.py", line 55, in create
    return self._create('tokens', params, "auth")
  File "/home/somik/openstack/dash/openstack-dashboard/.dashboard-venv/src/openstackx/openstackx/api/base.py", line 40, in _create
    resp, body = self.api.connection.post(url, body=body)
  File "/home/somik/openstack/dash/openstack-dashboard/.dashboard-venv/src/openstackx/openstackx/api/connection.py", line 82, in post
    return self._cs_request(url, 'POST', **kwargs)
  File "/home/somik/openstack/dash/openstack-dashboard/.dashboard-venv/src/openstackx/openstackx/api/connection.py", line 67, in _cs_request
    raise ex
Unauthorized: Unauthorized (HTTP 401)

The users have been created in Keystone, nova with keystone integration is up and running. The only caveat maybe that Nova uses MySQL and keystone is using sqlite db

What could be causing this failure? Alternatively, for maybe just diablo, is it possible to disable keystone and use nova auth?

Thanks!