Hey Bradley,
I don't have any experience with ADEM but I have been following this thead about your Jonathon. I can't imagine that holding him by his ankles caused him any harm. I can see doing that to my own boys. Boys are such thrill seekers and love that sort of play. Please don't beat yourself up about it. I can just see him laughing and playing while you fly him to bed.
PET scans are very expensive. They can tell a lot and can rule out any sort of cancer or tumors in the brain. I don't think you want to pay for that though. If insurance will pay then by all means do this.
I know that with optic neuritis I have a slight visual delay on things getting to my brain. This causes visual stimulation to create interesting sensations. I can remember taking my boys to see the bee movie a while back. That movie just about sent me over the edge with the flying parts. I had horrible vertigo and could not watch some parts. This may be what Jonathon experienced. If he is experiencing this sort of visual over-stimulation, then that may be the source of his panic attacks. Have him close his eyes and see if this helps.
I saw your sweet picture. You are very blessed. Also, we share the same last name! Your family and especially Jonathan are in my prayers.