Open vs. closed Loop, VX

[Farlander]

I hope to shed some light on this topic with a little help from you all. As is common with many obd1 hondas, the idle air control valve (iac) on my VX malfunctions and the car idles high, and occasionally the idle will fluctuate at a stop light when hot. As a hyper miler, I was getting irked by the high idle and surging, so I turned the idle adjust screw way down. Once in a blue moon, when hot, the car will actually settle down into low idle, but usually the iac keeps the motor running around 1000 rpms. I made the decision to disconnect the iac, by simply unplugging the 2 wire connector on the bottom. The new idle is low, I mean way low, around 400 rpms. I had it around 100 but the frequent stalling convinced me to come up a bit. Now however, the check engine light is on. So here are the three questions:
1. Is the car in open loop with c.e. light on and does that mean poor efficiency?
2. What are the negatives effects of low idle?
3. Is there anyway to trick the ecu into thinking that iac is still plugged in, via a resistor perhaps, or just jumping the terminals, so the check engine light goes off?

I will be taking measurements soon of the current, voltage, and resistance across the terminals of the iac to determine what if anything I could use as a jumper to bypass the iac.