I think it's very unlikely that choosing the wrong mount file caused damage to the hardware. It's more likely that it was a coincidence that the drive broke when it did. I can't be sure of course, but I thought I'd give my opinion since I'm the first person here to respond who's actually used an MO drive on his Amiga (mine is SCSI however). I've also done some ATAPI programming.
Also, are you sure that the device specification of trackdisk.device unit 7 is actually being used in your ZIP drive configuration? AFAIK trackdisk.device itself is only used for floppies, but IDE drivers (such as the A1200's scsi.device) are compatible with the trackdisk API, so trackdisk.device is sometimes used as a default driver.
