I've never heard anybody say 驚いてグラスを落としていました。　It should be 驚いたひょうしにグラスを落としていました。

hey, i don't think the second one is incorrect gramatically, i don't know if i can explain it well, but i personally think the translation for the first one would simply be " i dropped the glass because i was surprised." but the second one is just telling someone that you were very surprised and dropped the glass even though you didn't notice you dropped it. hope it helps :) good luck :)

If the "ていました" in the second sentence is used as progressive form, I feel it's just unusual. The word "drop" cannot be used in progressive form. (I am not sure "I am dropping the grass." is a natural expression, but I think it isn't in English as well.) However, as Ponko-san wrote, if the sentence means "I was surprised and dropped the grass (unconsiously).", it makes sense.

The first sentence is correct grammatically. The second is not. kazuki, good luck with your Japanese.