ugh i misundertand you question, you can check too adding the deprecate module LWP::Debug and you can see more detail in the server log.

#!/usr/bin/perl

use strict;
use warnings;
use LWP::Debug qw(+);
use WWW::Mechanize;

binmode STDOUT, ':encoding(iso-8859-1)';

my $mech = WWW::Mechanize->new;
$mech->agent_alias( 'Windows IE 6' );
$mech->add_header('Accept-Charset' => 'iso-8859-1');
$mech->get('http://localhost/');
$mech->submit();
my ($status) = $mech->find_all_inputs( name => 'status', type => 'opti
+on');
if (ref $status && ref $status->{menu} eq 'ARRAY') {
    for my $option (@{$status->{menu}}) {
        $mech->form_name( 'form' );
        $mech->select( 'status', $option->{value}); # Here's the probl
+em is send some utf8 string instead iso-8859-1
        sleep(2);
        $mech->click('send'); 
        if ($mech->success()) {
            print $mech->content(); # the response is in utf8 too
        }
        $mech->back();
    }
}
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