Rather than rant about the absolutely terrible raid I had last night of Obsidian Sanctum, I feel giving out advice will be more beneficial for myself and you guys who read this. So, diving right in, this is what I feel it means to be effective at leading a pug raid.
Know the Fight
You cannot lead something you don't understand or have never experienced. Go to someone else's raid first. Complete the objectives. Pay attention to gear levels, healing and tanking assignments, what causes wipes, what adjustments are made, and how the fight works. Don't just assume you know it because you read a few strategy guides; try it out. This will give you more confidence when directing your own raid, and help you make better tactical decisions.
Understand Requirements, but Be Realistic
It's a PUG. You're not going to get the best players from the top guilds. You might get their alts, in which case you're pretty lucky. Be understanding of people whose gear is not in top form. At the same time, understand what an instance requires to complete. If the vast majority of your DPS is only doing 1200-1500 DPS, one-drake Sarth is not for you, especially if they're also dying to void zones or not going through portals. Don't leave out someone due to less than spectacular gear, but know that what you bring affects what you can accomplish.
Swallow Your Pride
You are the raid leader. However, this does not necessarily mean you are the best tank/healer/DPS for the job. Understanding when someone outgears you, or that their class would be better suited than your own, is paramount for success. Ignoring this can still bring a successful run; however, it can be a lot less smooth and bring forward more wipes than necessary. And, if what you're trying isn't working, try listening to the raid members so you don't have to have half of them mutiny to take down Tenebron because it is clear to everyone but you that the raid cannot handle it (oh, was that a bit ranty, there? sorry).
Lead By Example
If you're leading a raid, don't be the one who cuts through the raid through a polarity switch or stands in the void zones or drags a spark through the other dragons. If you do this, people begin to doubt that you know what you're doing. They have, most likely, no previous knowledge of you or your skills. Letting them down in this way does not promote a stable raiding environment.
Know When to Call It
You're down to the last wing of Naxx, everyone's cranky, the priest who died five times on Frogger is being ridiculed, your tank is falling asleep on his keyboard and your healer's wasted from taking a shot each time the Death Knight pulled aggro. It's time to call it. Don't keep pushing; it will be there the next day, or the next reset. If this continues, the bickering will worsen, D/C's from sleep deprivation will increase, and your raid will fall apart anyway. Know when it's better to wait than push on.
Understand How to use the Master Looter
If you've never master looted before, have someone with you who can explain. Or here, I'll do it. You set it to Master Looter, set the rarity (most go with the Blue "Rare" setting). Then, when a mob dies and you go about the appropriate methods of deciding who receives the loot, you click the piece of loot, find the person's group, their name, click their name, and confirm it. Make sure you have the right name. This means reading the full name and verifying this is the winner. Also, make sure you loot the same item you have linked. Looting the Bag to the person rolling for the Spoils looks incredibly bad on your part.
Create Loot Rules and Stick to Them
Nothing causes more problems than loot. Express your loot rules clearly at the beginning of the raid. And follow them, discussing any change with the person the change would directly affect (i.e. asking if someone would pass for another since they have won so much already). Do not arbitrarily decide in the middle of the raid that you'll decide who wins a tie. Do not change loot rules to suit yourself and your friends.
Don't Overreact on Wipes
Not Safe For Work. You all know what it is.
And as amusing as it is, you can only pull this off with a guild. Do this to PUGs, and they are gone. And you have likely become your server's newest widely-known jerk.
Most Importantly, Learn from your Mistakes
You're not perfect. You'll mess up. Everyone does. Sometimes it's a bad pug, sometimes it's a bad day, sometimes you didn't know any better, sometimes you just do. Instead of dwelling on it, learn from it. Take the chance to see what you could have done better instead of blaming others or persevering in your screw-ups. This could be something like, oh, taking responsibility for standing in void zones and fire walls while tanking Tenebron, instead of saying you didn't get any heals.