I'm tending to doubt that. When I bought an extra master key and an extra valet key for my 2000 LS400 back in 2003, the service writer programmed both keys to work in the ignition. If the new valet key didn't have a transponder, I don't think programming it would not have been necessary or even possible.
Whatever you do, you should have more than one fully working master key and you might as well have at least one extra valet key - particularly since they are inexpensive. I've got three full sets for my LS - one for my wife, one for me and one backup set in a secure place.
!Removed! happens. You don't want to be in disaster mode if you ever lose your keys.
Sorry, you are correct. The valet key has a transponder, I guess it's hidden in the gray plastic. Now I am doubting if I can get a new key to work with the shell and uncut key I bought on EBay. My "master" key has a remote that unlocks/locks the door, but the key isn't recognized when it's put in the ignition. Even if I get a key cut that matches the cut on the valet key and switch out the remote portion of the key, I don't think I can sync it with the ignition to actually start the car. Wow, I thought this would be a simple fix, but I guess not.