if you pull on the power inflator to activate the left shoulder dump, you should not be able to inflate the BCD. Is this correct? . . . . If the above is correct, it would seem to me that pulling down on the inflator to vent air would put both hands in the area where they are needed.
You are correct about the mechanics of air flow. If you open a dump valve it will generally keep up with the gas inflow from a stuck inflator. And, having both hands on the LPI is optimal for addressing the problem, by disconnecting the LPI hose.
Rainpilot:
Some BCD / wings don't have pull dumps. I don't like to train emergency responses that are equipment dependent (muscle memory) so my procedure is: . . . Left hand raise hose as high as possible while pressing the deflate button.
And, because shoulder dump wires are not consistently present across equipment, I also favor, and teach, this approach. It accomplishes the same objective as pulling on the inflator hose to activate the shoulder dump valve (where present), and is more predictably functional.
I will add a 'soapbox' point, since the opportunity presents itself.
Divers should regularly practice the urgent / emergent disconnect of the LPI hose. This is one skill with which a number of people seem to have some (initial) difficulty during OW training. (And, it was a skill added to the PADI OW program in ~2103, so the OP would not have been exposed to it in 1996.) Many students don't seem to 'get' the physical operation of the quick disconnect sleeve, and want to pull on the hose before/while trying to retract the sleeve (which doesn't work, of course) - it is almost like trying to simultaneously pat their head and rub their stomach. Students manage to perform the task and meet certification requirements, but they are anything but facile. Like many OW skills, which should be repeatedly practiced after certification (but unfortunately aren't in a number of cases), becoming - and remaining - facile in performing this skill can really offset a rare, but potentially emergent, situation later.