We have West Nile and Dengue fever here, too. There are often TV news bits on mosquito prevention and the diseases they transmit, but I've never heard anyone suggest that mulch would harbor mosquito larvae.
Mind you there is so much other surface water around here, especially in summer, it's hard to tell where the skeeters are coming from. Ditches and puddles and ponds Oh My! I just take it on myself to patrol the standing water around and near our house, and it seems to help. All my beds are mulched and I do water in the spring and fall - our hot dry seasons. If they were breeding in the mulch, I'm sure I'd have more mosquitoes than I do.
