Dean,
Did some research this morning and found a solution for non-interactive configuration of necessary ENV variables. It seems, most systems have an "/etc/environment" file and this is where I added the following:
export LC_CTYPE=en_US.UTF-8
export LC_ALL=en_US.UTF-8
After saving the file, my connection with iSSH to the mosh server was successful! The real question in my mind now, is: what if you don't have root access to change this file in /etc? Can you save a local ".environment" file in your home directory to make this work? Or, do you just add it to your .profile? I have not tested either solution since I have root access on my server and was able to change the /etc/environment file.
Hope that helps others who have reported the same issue
Stuart