I really don't remember anyone using mulch when I was growing up - not a single person. I think with the advent of landscape companies, and now, even in a small town such as mine, there are dozens of them, mulch became the norm (for those that could afford it). I live in a fairly large neighborhood, probably with 100 (though it could be twice that) or so homes, and there are only a handful of us who tend our own landscape. Peer pressure keeps mulch popular here. Since the vast majority of people don't do any of the physical labor putting down the mulch, we who do our own yard-work pretty much are forced to "keep up with the Jones's".
The south certainly has plenty of insects, and mosquitoes are the norm rather than the exception. The Gulf coast areas really have a significant mosquito problem. I have never heard of mulch making a difference in mosquito numbers. Mosquitoes need standing water and mulch does not afford that, at least not that I am aware of.
