the fate of bitcoins (all will be lost - literally and eventually)

[RodeoX]

I kinda disagree.

I have no problem with the mathematical concept of infinitely dividing the remining bitcoins, BUT the problem is that nobody knows that the lost bitcoins are lost or simply kept under someone's mattress ...

That's a good point.

[Stephen Gornick]

my harddrive went extremely south shortly after... i.s. no backup, and all my attempts to recover my lost wallet failed. 

I asked around and was told there really is no way to recover a lost wallet if I had no backup.

There is a tool that searches a disk device for strings that are bitcoin private keys.   So even if you can't access the filesystem, if the bits are on the drive they might yet be recoverable:

Bitcoin private key/wallet.dat data recovery tool!
 - http://bitcointalk.org/index.php?topic=25091.0

[Atruk]

I agree with the backup suggestions but am curious how you could do a paper backup?  I know this is something my wife would feel more comfortable with?  Are you saying that you simply print the addresses found in the wallet?

You might want to look into using the Armory bitcoin client. It can handle of lot of tasks like making paper backups and backing up the keys of individual addresses you might have.