I have had it crash before, but that is about once every 3-4 weeks when I am busy. I can say that I have never lost something through a crash. After working with animation software, NLEs are easy. Some complain it is difficult, but it just is more overwhelming. The goal is the same, but the task orientation is different. The LE 5.5 upgrade is going to be $199 or $49 if you bought it between Sept 9th and release. The PCLE guys are starting to hang out with the new version just around the corner and could possibly answer. You could post in the Professional board and ask. Not sure that applies to the S9 to 5.5 upgrade. I know if you buy 5.5 now, you get the $49 upgrade path. But it does have a new time warp (but not audio - that is in LE6 though). There are some effects that it does not have (old film, stabilize, VST plug-ins). That is probably the workaround you are already doing. Rip the tracks you want and then use them from your hard drive. But! It appears to be a known problem as you describe and there is a workaround listed in this thread.
I found an issue with MP3s causing a crash and the latest version is supposed to fix that.
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