Normal response to water rooting. Leave it on, and don't disturb it. Roots will come eventually.

Thank you so much for the response...yes, another one has rooted :).

I know I've had plants develop this before when water rooting, but, not all of them do...maybe it's just "woody" plants that do it?

Poinsettia did this for me. It didn't develop proper roots until I put it in potting mix.

They are callouses so its like the plant repairing itself after being damaged, wont hurt it and should still propogate

This is the most common way woody entities take root, from what I've seen. The roots start out looking like this, not the long "strings" that one usually thinks of when thinking about roots.

This discussion is from 2 yrs ago, BTW.