The United States has not confirmed publicly reports that Chen, who slipped away from under the noses of guards and eyes and ears of surveillance equipment around his village home in eastern Shandong province, fled into the U.S. embassy.
China has also declined direct public comment on Chen's reported escape, which threatens to overshadow a two-day meeting with top Obama administration officials, including Secretary of State Hillary Clinton, in Beijing from Thursday.
But Texas-based ChinaAid said it "learned from a source close to the Chen Guangcheng situation that Chen is under U.S. protection and high level talks are currently under way between U.S. and Chinese officials regarding Chen's status."
"Because of Chen's wide popularity, the Obama Administration must stand firmly with him or risk losing credibility as a defender of freedom and the rule of law," Bob Fu, president of the religious and political rights advocacy group that has long campaigned for Chen's freedom, said in an email.
The standoff carries political risk for President Barack Obama, whose presumptive Republican challenger in November's election, Mitt Romney, has painted Obama as weak on China.
"The Obama Administration will be inviting attack from the Romney campaign ... if the right course is not decided immediately," said Michael Pillsbury, a former senior official in the previous three Republican administrations.
Cheng has put the Obama Administration and Hillary Clinton in kind of a tough spot right now. Republicans will light into the President no matter what he does, but the right thing to do here is to get Cheng out of there. The question is how.
The problem is doing so with Hillary Clinton meeting the Chinese make it look like all this was set up beforehand, and the Chinese don't like to be so openly insulted without a way out. On the other hand, finessing this too much looks like dithering. Still, it looks like diplomacy is already underway and something positive will come from it.
We'll see what transpires. What I do know is that Mittens would have found a way to screw this pooch already if he were running this show. The fact that this is being handled low-key and without the words "major diplomatic disaster" splashed all over the international press is probably a good start here.