I killed my expensive HD floppy in the same manner you describe, except it was one of my OWN old disks. :-x
The second you here that squealing sound, EJECT!!!
I can't belive I wanted the old game to work so bad, I let the drive squeal away for a while :cry:
I think the "mechanism lubricant" can dry out in the floppy and there's mildew, dirt etc, the foam breaking down from ozone.
Sorry to be of no help, but I will closely follow this thread for answers as well. :-?
