Yes, it's true that Ludwig-August left Europe with the intention of marrying Pss Isabel while his cousin Gaston ought to have married D.Leopoldina.

Why he did not marry Isabel is well known.

When the two princes arrived in Rio de Janeiro, L-A was digusted with the looks of both princesses.
He told Gaston that he would rather marry D.Leopoldina, for the great dispair of the Saxe-Coburg family.

Naturally the ambitious Gaston grabbed the oportunity and accepted to swap his bride for the heiress of the Empire.

Luckily Emperor D.Pedro II accepted the swap and authorized both marriages.
He had already met difficulty in finding proper grooms for his daughters and would not do anything to jeopardize the presence of the 2 princes in Rio.

the brazilian diplomat, Viscount de Taunay, left a curious portrait of the two princes:

The duke of Saxe only searched the pleasures of life and enjoy his status.
He appreciated the life in Europe and all the fun that could be found there.
The Count of Eu, despite his many faults, was seriously interested with everything related to Brazil, and deeply loved it without false pretexts.

As to the dynasty name it would probably follow the portuguese style of Bragança-Saxe-Curgo-Gotha