As I'm sure you know, HE is a very rare and poorly understood disease. There's not a lot of information in circulation, but it is known that HE often responds very well to steroids. So in an attempt to answer your three specific questions:
1) I certainly wouldn't be concerned about the side effects of the medication right now. It's been a short period and not a terribly high dose. Even if neither of those things were true, however, the likely worst-case side effects of steroids shouldn't outweigh the already good results you appear to have experienced from it. I'd give it a chance to work then weigh the pros and cons.
2) If the steroid therapy is effective you can recover muscle function in the affected areas.
3) Having GAD-65 checked couldn't do any harm, but may not tell anything much, either. It would be your doctor's call, but couldn't hurt to bring it up. And of course, based on the ever-present possibility of a weird coincidence, an MRI of the leg, while probably unlikely to show up anything new, certainly couldn't hurt and if there were someting structural it would probably otherwise be overlooked, so there's no real reason to not do it. Again, a doctor's call, but worth mentioning.
Hopefully the steroids continue to work well, since as of your post they'd already started to yield results. Please update us about this. Good luck to you, and follow up with us as needed.
John Kenyon, EMT, CCT
Non-invasive cardiology tech, Emergency and Critical Care technician, Critical Incident Stress Mgmt. specialist