Luis, is there ever a warning given to you by the thumb drive that it is about to die? Or does it actually happen where one day it is suddenly dead and you cannot access your data?
AFAIK, there are no warnings. You could set up the OS to not use a swap partition but you would need enough RAM to hold up all your programs and the OS. This would dramatically reduce the amount of writes to the thumb drive, keep in mind that configuration files, logs and such would still be written to the drive and they add up quickly.
Also, is it possible to plug in two thumb drives, one to host the Linux OS and the other to keep your data on it to extend the life of your thumb drive with the data?
That is possible, provided that you have the ports needed for it. The easiest way to do this would be to just plug the data drive once the OS has booted and then save/load all your data from it and avoid using your "desktop" and home directory (those reside within the OS partition). This method would make it easier to use truecrypt.
The hard way, which involves having both usb drives connected at boot up and having the OS mount the other thumb as a home partition might be trickier, since the USB enumerator is machine dependent and the configuration file for mounts (/etc/fstab) is most likely static. I don't know if there's anything like that but as I said, one is rarely the first to come up with an idea.
The intermediate way, would be to boot up the OS and then manually mount the 2nd thumb drive in /home, this allows for truecrypt, transparent use of your home directory but has the inconvenience of being annoying.