I was doing forestry research for the American Chestnut project back in the days when it was run by Lou Ismay. We went out in all weather, and we always seemed to be wet. The only time it was dry was when everything was frozen.
I found some US Army infantry uniforms that had been made at the end of WWI to protect the troops from gas attacks. The war ended, and by WWII they had better materials so the gas-tight wool sat in a warehouse. Anyway, they were fine, thick wool with flaps that buttoned over the openings. Oh, My!! They sopped up water and got wet.
My mother, who understood such things said, "They have to be oiled with lanolin." I went to the library and found the old manuals and figured out how to do it. I bought the best quality reagents, and followed the instructions. Then, I had oiled wool that kept me warm and dry in any weather.
A few weeks after oiling, the lanolin would start to oxidize, and then when it got wet it would smell like sheep. This was not bad in the forest with a camp fire, with the smell of the wet forest around us.
Then, I was drafted, and ordered to an inductee meeting one evening. It was a cold, rainy night, an hour's bicycle ride away, so I wore one of my oiled wool shirts. I arrived soaking wet, but comfortable.
The sergeant in charge took exception to my "lamby smell", and said things the way only a sergeant can say them. He used me as an excuse to display his command of the Army vernacular. It did not really bother me. I knew there was no way in the world he could have completed the bike ride I had just already ridden, and I had another longer, colder, uphill bike ride to do after the meeting. Nevertheless, 28 years later, when Jan from Frangipani yarns (http://www.guernseywool.co.uk/) brought up the topic, I was all ears. She told me about baby oil to oil wool.
I like lanolin. I make my own hand lotion for knitting and it is mostly beeswax, lanolin, olive oil, and lavender oil. However, when lanolin is applied to wool, it forms a thin layer on the wool fibers. That thin layer has a huge surface area allowing oxidation. (And the oxidation helps the lanolin to bond to polar regions on the wool.) The oxidation products and water produce the sheepy smell that raised the ire of the sergeant. When you put lanolin on wool it will oxidize, and when the oxidized lanolin gets gets wet, it will have a sheepy smell. I do not mind the sheepy smell too much. My wife has several sweaters that have lanolin on them, but when it rains, she always wears a parka over them so they do not get wet. Nevertheless, the last time we were coming back from Pt Reyes, it was her sweater, not mine, that perfumed the car with a sheep smell. I wear my sweaters in the rain and salt spray, and they do not smell of sheep. They may smell of fish, but they do not smell of sheep.
If you wash or dry clean your wool, and remove all the oils, then in the next rain, the wool will sop up water, and will not keep you dry (or warm). Thus, you need a rain coat or parka or umbrella to keep your wool dry. Or, you can just wear your wool in the house and not take your fine gansey out into the weather.
So, your options in the rain are wet wool, or a silicon product such as Scotchguard, or lanolin and smell like a sheep in the wet, or baby oil and run the risk of stains.
A drop or two of baby oil in the rinse water (after washing with real soap) will form a film over every fiber, so the change in color is very uniform and there is no visible stain. None! I have been using baby oil on all of my outdoor woolens for about 12 years now. It keeps me comfortable in the rain. It lets me wear my ganseys when I am splashing in the water, and then lets them dry quickly afterwards. Lanolin also works, but it is properly applied by dissolving the lanolin in enough benzene to submerge the garment. Benzine is hazardous, toxic, carcinogenic, and any residual is a solvent waste that requires special handling under RCRA (40 CFR 260 et seq.). Other methods of applying lanolin to wool fabrics do run a real risk of staining. The wool must be re-oiled whenever the wool is washed or cleaned.
Oh! Wet wool is a different color than dry wool. Freshly cleaned woolens shows splashes of water.
Much wool from the commercial channels will not tolerate washing with soap and water.
Baby oil is easier. Jan sells good yarn and dispenses very good advice. I like venders that give smart advice on how to use their products.