In my Direct3D application, the camera can be moved using the mouse or arrow keys. But if I hard code (0,1,0) as the up direction vector in LookAtLH, the frame goes blank at some orientations of the camera.
I just learned the hard way that when looking along the Y-axis, (0,1,0) no longer works as the Up direction (seems obvious?). I am thinking of switching my up direction to something else for each of these special cases. Is there a more graceful way to handle this?
Assuming you can calculate a vector pointing forward (what you are looking at - your position) and a vector pointing right (always on the XZ-plane unless you can roll). Normalize both these vectors, then up is forward x right (where x is cross product).
In general, you can plug in your yaw, pitch and roll into a rotation matrix and rotate the axis vectors to get right, up and forward, but I guess that's what you are using LookAtLH to avoid.
See http://en.wikipedia.org/wiki/Rotation_matrix#The_3-dimensional_rotation_matricies
The graceful way to handle this is to use Unit Quaternions. A quaternion is a vector of 4 values that encodes an orientation in 3D space (not a rotation as some articles assert) and a unit quaternion is one where the vector length sqrt(x^2+y^2+z^2+w^2) is 1.0. There are a set of mathematical operations for working with quaternions that are analogous to using matrices to encode rotations, with the added bonus that quaternions can never represent an degenerate orientation. You can freely convert quaternions to a 3x3 or 4x4 matrix when you need to feed the result to a GPU.
Your problem is that, while you are moving your camera, you will introduce a little twist into the camera's up direction. By forcing the camera to re-center itself on the (0,1,0) vector every iteration, you are in effect rotating the camera and then clamping the camera's orientation to remain on the surface of a sphere, but when your camera hits the pole of this sphere there is no good direction to call "up" and your matrix goes singular and gives you zero-sized polygons (hence the black screen). Quaternions have the ability to interpolate through these poles and come out the other side just fine, leaving you with a valid matrix at all times. all you have to do is control the "twist".
To measure this twist you should read Ken Shoemake's article "Fiber Bundle Twist Reduction" in the book Graphics Gems 4. He shows a good way to measure this accumulated twist and how to remove it when it is offensive.