If you encountered this issue after you burned a disc, and now the drive won't recognize media, i'd bet on this being a hardware failure, possibly the laser, crossflashing the firmware wouldn't fix it, i'd look into a new laser (ebay?) or just go try and get another drive...there are plenty of clones on eBay for 20$ or less shipped that you can flash to the iXtreme firmware, personally i am fond of the DH-16ABSH because you can easily find it on eBay for ~15$ and it is a iHAS124-04B clone.
Also I like the DH16AAS drives, because codeking put out a special version of the iHAS124 A firmware that has enhance overspeed and enhanced online hypertuning that yeilds great results when i use it...Only thing is for the XGD3 discs, you have to use the payload tool or imgburn with the payload to burn the full discs.
Side note: Why are you truncating if you have an iHAS B revision? you should be able to either put the ixtreme firmware on it, keep it stock and use the payload tool, and overburn the discs, getting all the data on there. Often with the truncate method, some games will not play properly, or read at all, and as far as XBOX Live goes, i can't see a better way for M$ to check for modded drives...Check out imgburn's options in page 2 of the write tab and turn on burnermax compatible and yes, then select overburn for the overburning method. If you use verbatims, (MKM-001/003, i like the 003's) burn it at 4x, and if you overspeed your drive, burn the 001's at 4x as well.
I've been doing XGD3 discs for a long time, and found that 4x, with overspeed enabled of course, on the 001's is even better then 2.4x...Any other questions feel free to post em, I'll check back.