I have a flight LAX-IAH in Y that a friend of mine is flying without status. He is connecting to a separate itinerary IAH-FRA on LH in F. UA should interline the bags since they’re all * flights, but will they charge bag fees for LA-Houston since they’d normally apply domestic, or not because of MSC rules going to FRA?

MSC is rarely relevant for a flight departing the US, and is definitely not relevant in this case; the DOT standard (first marketing carrier) would apply unless UA chooses to use MSC instead, which they generally will not..

If they interline the bags, I would expect them to do so for free; however, there was one recent report of someone who was able to get a partial interline — I guess they checked the bag onto their first OAL flight segment but not the second? — and was asked to pay, so this could be a new policy. The reason that there would normally be no charge is an accident of the way the interlining is done — the agent will add a dummy segment representing the F sector onto the UA reservation, which will then cause the computer to process the bags using UA’s allowance for the complete route and highest class of service booked.

Note that they will not interline the bags if your friend purchased BE.