The solution is simple but strange, if you copy your /var/lib/mysql directory to another server and think it will work, be sure to check if you have /var/log/mysql and binary log files. If you do, the server will not work and will give you errors like below and crash without the proper log files.
UPDATE user SET password=password("newpass") WHERE user='root';
flush privileges;
ERROR 2013 (HY000): Lost connection to MySQL server durin........
The first thing to diagnose is what is actually in the database (use PHPMyAdmin or CLI).
You will of course either find that the backslash is either in the database or not.
If the backslash is in the database you probably have magic quotes gpc/runtime on and/or are calling the "addslashes()" function which does this.
If you are escaping your data with mysql_real_escape_string() then think again, you probably have magic quotes gpc enabled either in php.ini or........