SQLyog does not change the MySql host address you enter in any way. Apparently you are new to MySql because MySql host address and the host name appended to the username are two entirely different things.
MySql host address is the name or IP address of the machine where MySql server runs. While the host name in the MySql username identifies the computer you are connecting from! SQLyog uses standard MySql client dll to connect to the server, so the problem is not with SQLyog.
Can you log in via command line utility?