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The developer package includes a feature to reflash the iLiad from a CF card in order to restore it. So, that's basically the same thing as a recovery CD, but it wipes all of your data (more like re-installing the OS).
I think there are still a few rare situations where the reflash won't work and you need to ship it back to iRex, but in most cases the reflash should get you out of trouble if you manage to mess something up. The reflash image to put on the CF card and instructions for the procedure are on iRex's website somewhere, but I don't have a link handy.
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