Today, while working on a new Drupal 7 site, I somehow managed to lock myself out. I knew the admin (UID=1) username, but could not for the life of me get the password right.
Drupal 7 uses a new password hashing mechanism, so I couldn't simply replace the user's password hash with an MD5 hash of a known value ([code]MD5(123);[/code] has long been my favourite for these scenarios!). A little bit of digging around in D7 core turned up the user_hash_password() function, which, as its name suggests, generates a hash of your supplied string (this time using SHA512 and a salt). The output of this function is what should be used as the new password in the users table.
For example, [code]user_hash_password(123);[/code] returns [code]$P$CD6Nf2aDgnBZZElo/teVOO2.h6sNT9/[/code] as the hash. Replace the existing hash value in the database with this new hash (of a known string!) and you're good to go!
Happy manual-password-reset day!