Mysql federated engine table creation error
OBSERVATION #1
According to the Book

Page 434 shows an example using COMMENT to establish a federated connection. Unfortunately, the book was written when MySQL 5.0.13 was released. Now, you use CONNECTION instead of COMMENT,
Here are my past answers (over a year ago) where I use CONNECTION instead of COMMENT:

Jun 28, 2012 : Connecting remote MySQL database to local MySQL database?
Jan 04, 2012 : fetching externally hosted db&#39;s table from within the local mysql server

OBSERVATION #2
You have this:
CREATE TABLE fedTransfer( `fedID` INT NOT NULL AUTO_INCREMENT, `transferID` INT, `outletFromID` INT, `employeeToID` INT, `transferStatus` ENUM('y'), `transferToDate` DATE, `transferToTime` TIME, PRIMARY KEY (`fedID`) ) 
ENGINE=FEDERATED;
COMMENT='mysql://root:passw1@192.168.2.103/mptest/fedTransfer';

Remove the semicolon from the back of the word FEDERATED
EPILOGUE
Your code should look like this:
CREATE TABLE fedTransfer( `fedID` INT NOT NULL AUTO_INCREMENT, `transferID` INT, `outletFromID` INT, `employeeToID` INT, `transferStatus` ENUM('y'), `transferToDate` DATE, `transferToTime` TIME, PRIMARY KEY (`fedID`) ) 
ENGINE=FEDERATED
CONNECTION='mysql://root:passw1@192.168.2.103/mptest/fedTransfer';

Give it a Try !!!