UPDATE - problem solved!
So over the weekend I did some trouble shooting. I managed to get the printer started with the cover in the up position.
Once the printer is running and in OFFLINE mode you can press F2 and F4 together to enter the manufacturers menu. Then press F2 to enter the sensor status screen. This allows you to test each sensor. You can use a piece of card in between the optical sensors and the output should change between 0 and 1.
With the cover up, the Z sensor was reading 1. With the cover down it was reading 0. This led me to believe it was an issue with the wire harness. I grabbed the main harness at the back of the printer, moved it around and the readout flickered between 1 and 0. Problem found. I removed the front cover then checked the continuity of the 3 wires from the Z sensor to the circuit board and the brown wire showed no continuity.
The sensor wires are 26 AWG and luckily I had a piece of CAT 5 cable that also uses 26 AWG wire. I pried the wire out of the Z sensor and replaced it with a new wire, running it down next to the original harness. I then cut and spliced this into the wire harness above the main circuit board where there is good access to the wires. I used a 3M Scotchlok to join the new wire with the original wire that runs down to the connector block on the circuit board.
Finally one last connectivity check before plugging everything back in and securing all the cables with cable ties. Back in business!
I have to say I'm surprised this problem isn't more documented. My guess is that after years of opening and closing the cover, the wires failed due to fatigue. There are some really large, very tight cable ties securing the harness that cause the harness to bend sharply or dig into it in several places. My guess is that this is where the wire failed.