No, I haven't heard of any specidic internal zip problems, but zip drives have had questionalble manufacturing on some runs, some work reliably, but many fail. If mine fails, I got my floppy to keep working, if the internal zip fails, you got to get a new one before you can mess with it.
I guess a back up external zip could be kept around if the internal fails. so if you really want it, do it, it really isn't such a big deal.
But also for transfer, sometimes floppies are enough, I like having more than one format available.
Having them touch up the paint or repaint it entirely is cool, they put all the words back and everything.
Yes they do it all, backlights, they may even be able to get those dents out or get you a new cover with the regular paint job. Not sure, email them or call, Bruce is really cool.