@Seedfork
Larry, That looks a lot like a stolon to me and not much like what daylily rhizomes look like.
You wrote that it formed under the mulch. The mulch was on top of the soil. What developed was under the mulch but on top of the soil. I assume that the mulch surrounded the daylily clump and actually touched the daylily clump above the soil. I expect daylily rhizomes to grow a length and then have a slight constriction every now then. I also expect them to be able to produce roots and shoots along their lengths, particularly where some of those constrictions are located.
I would call yours a stolon. I would say that it probably developed from a bud that was under the mulch and that sprouted to produce a new "increase" fan. Finding itself in partial darkness (because of the mulch) but not as dark as being completely underground it elongated to produce a long extension of itself (a crown - which is a stem). So what it produced may not have been rhizome-like but more stolon-like. Normally, those extension growths would start to form underground in the soil and in the dark and be a rhizome. The extension growth on your daylily may be similar to the extension growths of the crowns that developed after I buried entire fans under mounds of soil (
The thread "Planting daylilies "too" deeply" in
Daylilies forum)