In the example on page 477 of the Core Rulebook. Would (Could) Merisiel strike at the ogre (with cover as stated on that example +2 to the ogres AC). On the second action hide, because she has cover. On the third action strike again being, hidden, (lets assume she succeeded in her hide check) and receive the flat-footed condition on the ogre because she was hidden?
I guess what I'm asking is if you have cover in melee you can take the hide action, correct?
Yes, you can Hide any time you have cover or concealment (unless an effect granting those says otherwise, of course). There is no range limitation or requirement.
Yet remember that cover is relative to the position between you and who is targeting you. If for some reason an opponent around the cover you loose that cover against it you also aren't hidden from it anymore.
Cover is relative, so you might simultaneously have cover against one creature and not another. Cover applies only if your path to the target is partially blocked. If a creature is entirely behind a wall or the like, you don't have line of effect and typically can't target it at all.
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Yes, you definitely can.
Now, remember that if your GM feels it's a bit far-fetched they can give you a circumstance penalty to represent how hard it is to hide next to the creature you're hiding from. This is definitely something I'd do if a character tries to do that as it's in my opinion not very realistic.