Manual:$wgDBmysql5/de-formal

Details
Note beforehand: No matter what you set here, MediaWiki internally always uses UTF-8 encoding. Everything MediaWiki sends to the database is always in UTF-8 encoding.

Set to true to send 'SET NAMES=utf8;' on connect. If set to false, 'SET NAMES binary;' will be used, which is the default and so recommended. Generally you should not change this value once installed -- if you created the wiki in Binary or UTF-8 schemas, you should keep this off. The feature is experimental and with your settings the data is sent (and so also finally saved) with the right encoding anyway.

( See also which in recentish versions will include the table type and character set used when creating tables. )

May break if you're upgrading an existing wiki and then change this setting. Symptoms of brokenness are likely to include incorrect behavior with page titles, usernames, comments etc containing non-ASCII characters. Might also cause failures on the object cache and other things.

If you are still using MySQL 4, your wiki was created with the old "MySQL 4 backwards-compatible UTF-8" schema and $wgDBmysql5 should stay off; your MySQL version does not support it anyway.