How widespread is the idiom 蘑菇? I have seen the word for mushroom [蘑菇, mógū] to be an action such as dilly dally. 

Is this an inherent idiom in the written language apparent across a large spectrum of dialect, whereas the word mushroom connotes, from some reason such an action? Or is it local to spoken dialects of Manderin?
I heard it's being used especially by older people in northest region. For example, 别蘑菇了，老蘑菇什么. 

It's a synonym of 磨蹭. Maybe, 蘑菇 sounds folksy. 

You might find it's used in some old novels as well.