Hard to say why it decided to kick the bucket like that- it could be overheating due to a high amount of dust inside or possibly a part inside that slipped past the quality control during manufacturing deciding to show its true colors. Too many reasons why to count.
The PS3 is a great machine and I think you'll be happy with it when you get one. If possible, i would try to find a 60 GB system to ensure maximum backward compatibility (it has the actual PS2 chipset inside, at least with the North American version). The 80 GB uses software emulation and isn't as robust for PS2 game play. Both are getting increasingly hard to find with the 60 having been discontinued a while back and the 80 GB looks to be headed the same way (or at least the bundle with Motorstorm is). The 40 won't play PS2 games at all so that wouldn't be an option for you.