I thought I'd weigh in, since I farm meph exclusively with a hydra/orb sorc. It seems that for most purposes, hydras are treated like minions. So, mf definitely works with them. Remember, the Quality (ilvl or usefulness) are not affected by mf, only whether the item is magic, set, unique, or rare. I mention this because it is easy to question the effectiveness of mf after mephy drops you his 92nd green breastplate or 53rd gold crossbow, when in fact mf has no bearing on whether it is a bp or cb. If you had on less mf they would still drop, but more of them would have been white or blue.
Following along the tangent, it is true that some effects do not work with hydras (minions, remember.) When running the pit, I wear a nature's peace ring. With an orb kill, I get the nice "wooomb" from the RIP feature. When hydra slays 'em, no such luck. It is the difference between a necro's skeleton killing a monster and the necro himself bashing him over the head.
Finally, + to fire skills certainly helps hydra because it summons a higher level hydra which does more damage. I believe that you have to have the hydra cast before you slap on the + skills, so you can't "bump" your hydra after he's cast, but I'll have to check this for sure. I will say that with mf gear, my lvl 26 hydra, 26 fm, 20 fb and 7 fbolt, i do 833-966 damage. Slap on rising sun and that goes 900-1040 due to the extra fire skill (I usually wear a +1 sorc ammy.)
Ok, this got a little long, but I hope it helped.
