We regret to inform that the LED you are referring to is for the hard drive activity and there is no option at a BIOS or software level to disable it. Thank you for your understanding.
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Check Radio Shack (or some other supplier of electronics for hobbyists) for brush-on liquid insulation coating. It's opaque, very thick and applies easily. Non-conductive. Once it's cured, it can be removed by simply peeling it off.
Mine is from CG Electronics (Carl Goldberg) and the part number is 10-1762. Comes in s 60ml bottle, which appears to be a lifetime supply.