MySQL not reading my.cnf in MAMP
Added skip-character-set-client-handshake to the [mysqld] group of the my.cnf file.

# The MySQL server
[mysqld]
skip-character-set-client-handshake
collation_server=utf8_unicode_ci
character_set_server=utf8


My-small.cnf as supplied in "support files" does not contain this, subsequently my connection was overriding the values, causing me to think the file was not being read... newbie mistake.

Solution mentioned on the MySQL manual here.