I bought an HV20 last month and decided not to get the extended warranty through Amazon, since it didn't look very good.
I bought a JVC DV from BB 7 years ago and did get the warranty, and was pleased that I did, as I needed the DV drive replaced. That was a notorious problem with the JVCs. I also got it for the Canon Elura a couple of years later, and have not yet used it alothough I though I was going to need it when the DV drive stop accepting tapes. I put the camera aside for a while, and the next time I tried it, the driver worked and has been working ever since.
The HV20 does have that mechanical nightmare as well. That's the one piece that I am not confident will fail within the 1 year manufacturer's warranty, due to my own limited history (also had a DAT deck go out - it also has a minature helical scan tape drive.
The reason these devices are so expensive to fix is that they require considerable skill to take apart, replace the bad board (an expensive assembly) and then get it back together without causing some other problem.
But if you get a second year from the credit card, then it is better.
Beware the renters or home owners insurance. Those policies may well have the $500 deductible, which means you can just about buy a new camera before the insurance will pay anything. You can get different policies for work/professional equipment, but they cost considerably more than the add-ons to homeowners insurance.