That is really strange though. MySQL root password is required when installing ERPNext via the EasyInstall script method.
Can you check if you’re able to login to the MySQL server using mysql -u root
Also, here’s a tried and tested method of installation which works flawlessly with the DNS based multi-tenancy setup that you’re trying to achieve.
I’m using a similar setup with more than 5 instances of ERPNext and plain Frappe on a single server.