I'm trying to get rid of the GD ROM drive, and I know that you can flash Dreamshell so that it boots straight into it, but can you do so over the standard chip, or do you have to buy a custom modchip/do any hardware modifications?
You mean to flash the bios chip?
If so that is not possibile, you only change the region. If you want to reflash the bios you must piggyback a eeprom on the bios chip. Then you flash it with a region free bios.