If you remove the 470Ω resistor then the load on the pin becomes too much and the pin never gets to a voltage that would be read back as a logic low. It will always be around 3V.
If you change the code to,
Code:
list p=16F628A
include <p16F628A.inc>
__config 0x3F34
org 0
bsf STATUS, RP0
movlw b'00001110'
movwf OPTION_REG
bcf TRISB, 0
bcf STATUS, RP0
movlw 1
xorwf 0x20,F
movfw 0x20
movwf PORTB, f
sleep
end
it should start flashing again. This works because it uses a SFR (ram) location to remember the previous state.
Mike.