wheel - 9:13 pm on Feb 7, 2011 (gmt 0)

OK, you had it installed and working correctly. Here's where you went wrong.

You type in localhost:8888 and you get your local site.

You type in (or in this case, click) www.example.com/wp-admin - and where is www.example.com? that's right, it's on your webserver, the live copy.

You should have visited localhost:8888/wp-admin. That (or some url like that) would have taken you to the local copy.

But that alone won't fix your problem. Here's what you really need to do (and the only thing you need to do, that will fix your problem). You need to tell your computer that www.example.com is on your local pc not your webserver. Then ALL your links will go to your local pc.

This is done in a hosts file. You should google 'mac hosts file' on how to change it on a mac. Basically you'll add a line something like this:
127.0.0.1 www.example.com

So, in summary, rebuild what you'd done. Change your hosts file. Restart your browser, and you can then go to www.example.com/wp-admin on your local pc.

Whenever you want to see the live site again, comment out the line in your hosts file and restart your browser.