Ok, this is getting ridiculously painful... here's what I did so far:

-deleted previously created endpoints and ran alter db set partner off

-went into SQL Server Config Manager and made sure TCP is enabled, then added the endpoint ports to the TCP All field

- restarted the SQL Service

- run netstat and confirmed that the endpoint ports are now LISTENING

- from both PRINCIPAL and MIRROR, ran "telnet FQDN port", confirmed that I can connect from both (as opposed to failing a few posts above)

- created the endpoints on both servers

- granted connect permission to the sqlservice account (same service account on BOTH servers, I am using a domain\user account)

- backed up and restored DB and logs with NO RECOVERY

- ran alter db set partner on the mirror server - SUCCESS

- ran alter db set partner on principal server

Msg 1418, Level 16, State 1, Line 1

The server network address "TCP://dbm-mir.domain.com:6025" can not be reached or does not exist...

I am all out of ideas...