mr. intelligent :)

Oh, you. *blush*

You sound like you kinda get it, but kinda don't, so i've prepared a lovely diagram. (sorry to those monks using a screen reader)

        ___          
       (___)
 mysql |   | --> your daemon --> useradd
       |   |    (as root)   
        ---
         ^
         |
     CGI scripts
    run by Apache
(as nobody, apache or httpd)

The reason you want it to be so convoluted is because of user permissions. The CGI scripts must run as the least privileged user (cause you cant trust the internet) and you must run the useradd stuff as root. (ofcourse you need to authenticate users on the CGI script so randoms can't just add their own user)

Another solution might be to use some sort of directory and PAM authentication. You can add users to an LDAP directory as any user that has permissions on the directory ... (but that has many overheads)