In your opinion how much longer do you think a 3-year-old drive could last?
I've got a drive in my house that's 14 years old and still boots up. I had another that failed after six months.
Hard drives are like light bulbs: they are designed to last an AVERAGE MEAN of "x" amount of time/hours, but they can fail at *any* time.
I read somewhere that Macs CAN ONLY BOOT from an external via Firewire, not USB. Is that true?
No, not true. For at least the past five years if not longer, all Macs can boot from USB2. That said, Firewire is still faster than USB2.
I have a Firewire external with enough space, but I don't know how to do that.
Amazingly, both programs' authors wrote help files to explain exactly how the programs work.
Is it simply a matter of installing the OS directly from the 2 DVDs that came with my Mac?
If you're still referring here to creating a clone using SuperDuper or Carbon Copy Cloner, no that is unnecessary. As their name suggests, the programs simply copy *everything* on your hard drive onto an external in an identical setup, and then update that as needed. System, apps, stuff, porn ... it's ALL there.
Once that's installed do I have to press a certain key before I power on my Mac in order to boot from the external?
No. If you wish to choose which drive to boot from, you hold the option key down immediately AFTER power on until the drive selection screen shows up (which should happen in just a few seconds). All *bootable* drives (that is to say drives with valid system folders) will be shown. Non-bootable drives won't show up, and that's normal for this particular screen. You use the arrow keys to choose which drive to boot from, press return, that's it.