unable to create new site
I managed to get it working. The missing link was the sites/sites.php file.
Although I did provide that, it started working after I put the following in it:

$sites = array(
   'localhost.owtest' =&gt; 'owtest',
   'localhost' =&gt; 'default',
);


I can now browse to localhost/owtest and have a completely different content collection that is used by the localhost site itself.
Now I am facing a style problem, I keep tring...

Ruud