In my opinion, unplugging and reconnecting the IDE cable is no more (and maybe less) risky than doing the same with the power cable. In my experience, I feel more comfortable hot reconnecting a data path rather than a power source due to the possibility of a power spike or surge gumming up the works. As cfitz has alluded, this is not an exact science. In any event, do what you feel comfortable with as you are the one who has to pay the freight.
If memory serves, this same type of problem you are experiencing is related to the operation of the motherboard, which is not allowing a boot if the drive isn't functional. I think others have solved the problem by removing the drive and installing in a computer with a different motherboard (can't remember the exact ones that work, but the ones that don't are probably uncommon). If another computer will allow the boot, then you can reflash in that computer, fix the drive and finally reinstall it in your computer.
Another option is found at MtkWinFlash can recover dead drives now!!!
. This software allows dead drives to be flashed and recovered in Windows
Another possibility is that your BIOS may be set to boot first from CD-ROM. If so, then the failure of the drive to be recognized may abort the whole boot process. In this case, changing the BIOS to boot from the A: drive could be an elegant solution (if it works).
Last, but not least (quite the contrary), there is a whole thread at CD Freaks devoted to information about bad flash recoveries at Bad-flash-recovered LiteOns
. Some of the reports are almost identical to yours, so I am fairly certain you will find a solution there