Is it possible to toggle hidden files without relaunching Finder?

There are several ways how to toggle hidden files - via a shell command, or AppleScript, or Automator action, or even a Dashboard widget. All of them close and reopen Finder windows, which is quite annoying.

On the other hand, for the Open File dialog one can easily toggle hidden files by pressing Command+Shift+Period.

Is it possible to avoid relaunching Finder?

Conclusion

It is better to use Path Finder instead, which allows not only to toggle hidden files without a perversion, but many other nice things. Really awesome app.

There is a solution now.

The latest release of TotalFinder (0.9.1) can toggle show/hide hidden files without Finder restart. Tested it, it works well, and removes this long-lived annoyance of the Finder. TotalFinder is free for now as it is prerelease software, but will be around $10 or $15 when it hits final.

No, you cannot, because there is no way to notify the Finder (or any process for that matter) that its preferences file has been modified behind its back.