Upon first inspection, glycerin and mineral oil appear to be identical (or at least very similar) compounds: They’re both colorless, mostly odorless, and have mild lubricating properties that make them feel slippery when rubbed between the thumb and index finger. Chemically, however, they are very different compounds.
Mineral oil is a hydrocarbon, meaning it contains nothing except carbon and hydrogen and is a byproduct of the crude-oil refining process. Mineral oil is not soluble in water: If the two are mixed, they will form separate phases, with the mineral oil on top. Some mineral oils have been linked to cancer in animal studies involving exposure to oil mists
Glycerin is actually an alcohol and is produced by the saponification of plant or animal fats. Saponification is the reaction between the plant or animal fats and strong bases (like lye). Unlike mineral oil, it is soluble in water. In fact, it is hygroscopic and will actually absorb water vapor from the air. Glycerin is used by lure and bait makers mostly as thickener, binder/blending agent and sweetener, also as a humectant to keep baits moist and as a mild antifreeze agent in lures, baits and urines. Glycerin is not carcinogenic and is not believed to be toxic unless ingested in large quantities.
I suspect that years ago mineral oil was used because it was easier to obtain than glycerin.
Mr kytrapper, separation of a good, properly compounded lures' ingredients is quite normal over time and is not detrimental to the mix. Just shake it before use and you can grin knowing you will have continued success with it.