All hard drives are meant to die.. whether it's in 10 years or the first month.. but there are ways to speed up the process. Although unless you were moving it around all the time in the USB case, I don't think that had an affect on it.. probably just picked the wrong one.
A lot of people say having the hard drive on all the time is better than turning it off as it doesnt have heat up and cool down all the time.. causing the metal to expand and contract.
You should be able to get a new replacement drive if you've got a warranty.. If you want to try to salvage some of the data (with out spending thousands of dollars) try using Norton Ghost to take an image of the dead hard drive.
__________________
|