  We apply ionization balance and MHD calculations to investigate whether
magnetic activity moderated by recombination on dust can account for the mass
accretion rates and the mid-infrared spectra and variability of protostellar
disks. The MHD calculations use the stratified shearing-box approach and
include grain settling and the feedback from the changing dust abundance on the
resistivity of the gas. The two-decade spread in accretion rates among T Tauri
stars is too large to result solely from variety in the grain size and stellar
X-ray luminosity, but can be produced by varying these together with the disk
magnetic flux. The diversity in the silicate bands can come from the coupling
of grain settling to the distribution of the magneto-rotational turbulence,
through three effects: (1) Recombination on grains yields a magnetically
inactive dead zone extending above two scale heights, while turbulence in the
magnetically active disk atmosphere overshoots the dead zone boundary by only
about one scale height. (2) Grains deep in the dead zone oscillate vertically
in waves driven by the turbulent layer above, but on average settle at the
laminar rates, so the interior of the dead zone is a particle sink and the disk
atmosphere becomes dust-depleted. (3) With sufficient depletion, the dead zone
is thinner and mixing dredges grains off the midplane. The MHD results also
show that the magnetic activity intermittently lifts clouds of dust into the
atmosphere. The photosphere height changes by up to one-third over a few
orbits, while the extinction along lines of sight grazing the disk surface
varies by factors of two over times down to 0.1 orbit. We suggest that the
changing shadows cast by the dust clouds on the outer disk are a cause of the
daily to monthly mid-infrared variability in some young stars. (Abridged.)
