Overclocking
Hotter: Yes (means you need a better cooler and some decent case airflow)
More power hungry: Yes (means you need a good quality PSU, with sufficient capacity)
More prone to failures quicker: Depends, If you properly stress test the system for 24 hours then you aren't likely to have any troubles during the useful life of the system. Overclocking does generally reduce the life of components, but we are talking from 50+ years to 10+ years, so by the time it "dies of old age" it will be completely obsolete.
Also, the lifetime of the component is affected by the specifics of your overclock. If you are overclocking with stock volts and an aftermarket cooler so the temperatures are lower than on the stock cooler - then I don't imagine the chip will age too prematurely.
As for "should I overclock" that is up to you, based on what you want to do with your system and how much effort you are prepared to put in. If you are doing CPU intensive apps, then overclocking can be very beneficial - in some well threaded apps giving you linear performance improvements. If you are primarily gaming, then there are many games that benefit from CPU clockspeed - but GPU power is often far more important.
As for GPU overclocking, I generally steer away from it. I recognise the benefit of it, but my particular card comes with a 10 year warranty and little in the way of aftermarket coolers (apart from water blocks). In my experience graphics cards are far more likely to die than CPUs (this is often nothing to do with the GPU chip itself) and I buy one that I know is as fast as I need it to be and if/when it does go pop I can send it in under warranty in clear conscience.