Is lemon grass an effective insect repellent?

Yes, it is the oil (cymbopogon flexuosus) found within the plant that acts as an insect repellent, and insecticide. It is certainly not effective in all situations and I would suggest that you refer to the EPA's chemical database for more information. It is obviously recognized by them as such; the EPA code for Lemongrass Oil is 040502. It is a tropical grass native to southern India, and Sri Lanka. It's scientific name is Cymbopogon Citratus.