> That relies on being able to keep the data files storing all those passwords safe. And not just from outside threats but also hardware and software failure.
If a attacker has access to your user account then they have access to your passwords. It doesn't matter if you type them in, use encrypted store on a keyring, a spreadsheet on a truecrypt encrypted USB drive, ssh private public keys, have your browser store them, or use a plain text file at ~/.secret. If you use it and can access it from your user account then the attacker can access it too.
Really, though, using a password management mechanism of some sort is extremely advantageous. Once you stop needing to memorize your passwords it's very easy to use unique, long, and very random ones.