Drawing an arc while raising the pan can be mitigated somewhat.
The way I was trained, you press and hold the "Pan Up/Reset" button for 15 seconds before releasing it. Pushing the button in will raise the pan but the VCB will remain open until the button is released preventing the train from drawing any power whatsoever and causing an arc as a result. 15 seconds should be sufficient for the pan to go up and meet the contact wire, though you should always check before releasing the button to close the VCB. Sometimes you can hear a faint
"bzzt" as the pan nears the wire and at some locations you can see the wire sway slighly as the pan makes contact.
Then again, you can't always rely on drivers to follow instructions correctly.
The reason why you don't raise a pan on the move has more to do with the likely affect of the sway caused by a pan in motion. In a lot of cases you could probably get away with it, but the OLE is not actually designed to permit this operation. Therefore there is a chance that it will all go horribly wrong and the additional sway induced by a pan making contact with the wire could be enough to cause the pan to run off the wire or some other calamity that could damage the pan and/or the OLE.
Dropping a pan on the move is far less contentious. If you couldn't stop before reaching an obstruction on the OLE you might consider dropping the pan then, plus there is the new rule that allows electric trains to coast under a known obstruction. However, in both cases the train would need to be stopped so that the pan(s) could be raised again.
I have always assumed that bi-mode IEP's will have traction changeovers at booked stops rather than "on the fly". This is the most logical way of doing it.
O L Leigh