Weird. 4.x isn't known to mess with modchips. I'm quite sure you never touched the IOSes, since cIOSCORP is softmodding, and pointless for chipped Wiis.
If this did not occur immediately after the 4.1 update, try using a lens-cleaning kit.
If it still can't read discs, try removing the modchip, and check if the drive still can't read Wii Sports. If it can't, your drive is probably dead.