In the time that .fx is talking, the Intel chips were hard locked and I never heard of someone successfully unlocking them. The pencil trick was used on the pre-Barton AMD chips. With the Barton's (and the other AMD cpus of that time), you had to get a silicon paint and use that to bridge the connection (I think it was the L1 you bridged...but it's been awhile). What .fx said about the cpu testing is correct. They'd batch make a bunch and then test them at different speeds. While each chip is manufactured the same way, each will perform differently because of many different reasons so those that perform better at the higher speeds are sold as such, those that didn't were sold as slower cpus.
As for shortening the life, any time you "over-"blah anything, your putting more stress on it so it's only logical that it's lifespan will be shortened. But in this day and age, the turnaround time on new chips is so fast, you'll most likely upgrade before you come anywhere near blowing out your chip. This of course assumes you stick to the stock voltages. Once you start fiddling with the voltages, you can take a perfectly good chip and make it into a key chain on one boot up.