I have an ALIX running 2.3.3-p1 and it still chugs along. It's not perfect, but it runs. The hardware was great for its time, but it's past EOL. If it still operates, keep using it.
We intend to support 2.3.x for a year or so after 2.4 releases. You're welcome to keep running 2.3.x as long as you want on there.
NanoBSD upgrades have always worked fine in our testing, and from our customers that have reported issues, most of them were due to faulty CF and the others were connectivity related or in very rare cases, a configuration issue preventing DNS from working during the upgrade.
Even new cards can be faulty, it's the luck of the draw there. We can't fix or code around broken disks. Sandisk is usually reliable and fast, at least the 200X ones I typically use. You have to pay a little more for them but they are worth it: SanDisk SDCFH-004G. But even the best CF is still CF.