How to prove or disprove that $\frac{\pi}{2}$ is limit of $\sin^{-1}x$ as $x\to 1$ by using $\epsilon-\delta$ method.
My attempt:
$|\sin^{-1}x-\frac{\pi}{2}|=|\cos^{-1}x|=|\sin^{-1}\left(\sqrt{1-x^2}\right)|=|\sin^{-1}\left(\sqrt{2(1-x)-(1-x)^2}\right)|<|\sin^{-1}\sqrt{2\delta-\delta^2}|$
If $\epsilon=\sin^{-1}\sqrt{2\delta-\delta^2}$
$\delta^2-2\delta+\sin^2\epsilon=0$
$\delta=1\pm\cos\epsilon$ or $\delta=1-\cos\epsilon$
So for every $\epsilon>0$ in the neighborhood of $0$ there does exist a $\delta>0$ and we are through.
If the above argument is correct then $$\lim_{x\to 1}\sin^{-1}x=\frac{\pi}{2}$$ But $\sin^{-1}x$ does not exist in the right neighborhood of $x=1$ i.e.$$\lim_{x\to 1^+}\sin^{-1}x=does\space\space not \space exist$$.
Why is there a contradiction in the two approaches
The contradiction you perceive is rooted in a looseness in the definition of limits.
A formal definition of a limit should state the domain and range of the function $f$ very explicitly, should restrict $a$ to be a limit point of the domain of $f$, and should restrict $x$ to vary only in the domain of $f$ (minus the point $a$, if it happens to be in the domain of $f$). When you do that, you get the following definition, with the bold faced portion emphasizing how $x$ is restricted:
You can see a definition formulated in this manner in Fitzgerald's Advanced Calculus book.
Regarding your proof, it seems a little convoluted and hard for me to follow, although I think the general idea is correct.
I would suggest a more direct approach, instead of trying to use an identity involving $\cos^{-1}$: Given $\epsilon>0$ let $\delta = 1-\sin(\pi/2-\epsilon)$ and then apply the fact that the sine function is continuous and strictly increasing on the domain $[-\pi/2,\pi/2]$.