I'm sorry to hear the problem.
If you haven't try DiskWarrior, you should give it a try. It's cotly utility app but it's worth to have one.
Well, the HDD has been unstable on Lion although WD claim that it works on Lion.
They released a new firmware update in October last year but I was even able to apply it. A problem occurs when you try to update the firmware. No matter how many times I tried, it didn't work. I contacted with the customer support and exchanged e-mails and they couldn't give me a solution. Hope they will solve the problem . It could be because of the firmware.
I used to depend on one backup but now I use the only unlimited online backup service called Backblaze.
It's $5 a month and unlimited. Unlike another service Mozy(used to be the only unlimited online backup service), it never slows downs the performance and work beautifully. I suggest that you check it out. Having a backup on external HDD is good but sitll having a backup only on external hard drive has some risks and losing your precious data is a nightmare., so we need a backup of a back up nowadays.