I found a solution to the problem on StackOverflow. It's not a wagn-specific problem & was tagged there as a Rails issue. I never encountered this problem using Rails but ran into it with wagn because with Rails I'd only ever used sqlite; the problem is exposed when needing to load dynamix libraries. I'm sure I won't be the last to run into this when trying wagn for the first time so I'm posting it here to save others' time.
Credit for the original solution can be found in place at StackOverflow: http://stackoverflow.com/questions/9201406/ruby-on-rails-mac-x-os-lion-run-server-loaderror
The solution is simple:
export DYLD_LIBRARY_PATH="$DYLD_LIBRARY_PATH:/usr/local/mysql/lib"
Excellent. Thanks so much for posting the solution!