DB,
Shy, I am not suggesting there is anything like an absolute answer. However, I am convinced that exposure to TR Drive failures in the hover, in the FSTD, to overcome the initial "Startle Effect" will significantly improve the chances of success in the real helicopter. Of course all the hooded horsemen of the FSTD apocalypse rise up when we defeat the flight loop in the FSTD. Modelling is problematic as OEM data for these events are generally not available for obvious reasons. However, even if the FSTD modelling is dodgy, teaching a reaction to the event is still important.
I didn't mean to imply anything else - I don't think there is an absolute answer to this type of failure because of differences in aircraft design and how, when and where the failure occurs.
In the case of an IGE hover, in a helicopter where there is no immediate way of "rolling off" the "throttles", I think I'd lower the lever asap, as you say, and accept the yaw rate at touchdown. If I had a second crew member who could either retard the ECLs or switch the engines from flight to "Off" it would be a bonus, but he'd have to be very quick!
Edit: Just checked my S-76 RFM (more than a bit dusty now - I've not flown the type for well over ten years). The advice therein is to lower the collective then select both engine levers to OFF at about ten feet and use the collective to cushion the touchdown. You need two left arms to do that, or be lightning fast if you're at a ten foot hover!
Obviously, as an ex-sim instructor I totally agree with the rest of your post. Any sim training is of benefit but it was sadly neglected in the past by the UK military and elsewhere.
As I've posted on the forum before, I know of at least one RAF helicopter crew who said that without the sim training they had received, they probably wouldn't have survived 'their' tail rotor malfunction (albeit in this instance a loss of tail rotor control, rather than a total loss of drive). They ended up in the North Sea and the aircraft was recovered almost intact despite it not having floats fitted - although I'm led to understand that it suffered fire damage after recovery and never re-entered service!.