As the owner of a Lotharek-built Ultrasatan and STe I can say that they work well together, but my STe has (and has always had) the '001' DMA like JG53_Jaguar's does. I can recall at least one thread where someone with an UltraSatan, STe and non- '001' DMA tried every reasonable thing before fixing his card corruption problems by fitting a '001' DMA. However, opinion seems divided on whether the cause and cure are really so consistent or simple. Luckily the OP already has the 001 DMA fitted.
When my original conventional HDD failed it was down to failure of the SCSI to ACSI host adaptor in the drive unit, not the drive itself.
I bought a SCSI adaptor card to put in a PC running Linux, connected the SCSI drive from the Atari HDD unit directly to it and used the Linux 'DD' command image to read a sector-by-sector copy of the original hard disc contents into a file on the PC - at 60MB or so the file was insignificantly small by modern standards. I then found that I could use this image as a HDD image in Hatari (ST Emulator) so that was a great way to check that the HDD image was good before spending more money.
Having established that the image was good I ordered the UltraSatan and used the same Linux DD command to copy the HDD image onto an SD card sufficiently large to contain it - I used an old 128MB card which had previously been used with a digital camera, put it in the UltraSatan slot B and was able to read everything off it onto the main card.