The "old style" error is because you're specifying the driver name as an argument. The following works, however (Postgresql in my case):

my $dbh = DBI->connect("DBI:Pg:dbname=$database",$user,$password );
[download]

I found this bit, straight from Tim Bunce (June 97, DBI-user mail list) which shows the difference between the two methods:

Old-style: DBI->connect('dbname', $user, $pass, 'Driver');

New-style: DBI->connect('dbi:Driver:dbname', $user, $pass);
[download]