I had failure on a brand new KMC chain I bought just a couple weeks ago. I was trimming the length when I pushed the pin the rear plate just cracked into 2 pieces. It came with more than enough links to replace the broken part so I just replaced it and its been ok so far for a $6 chain. I also dip my chains in paint thinner to remove grime and grease, then rinse and lube. As far as chain wear I know they make a small gauge you can buy that will tell you when the chain has stretched past its safe point by measuring the length between links.
http://www.parktool.com/products/det...t=5&item=CC-2#