As with all applications on any platform, you should save your game periodically to prevent the loss of the progress you've made in your game. Crashes and other bad things happen on any computer, and the Treo (being a phone) introduces an extra level of complexity to handheld devices. Standard practice for Palm OS applications is to save the application data when you exit the application, either to the launcher or to another application. I do that regularly with Village Sim, usually by returning to the launcher.
Some of the things you described are due to the fact that you left the game running for long periods without saving it. If you start a new game and run it continuously, if you have an "event" that aborts Village Sim, the next time you launch the game your old game will be loaded and will be treated as if you hadn't checked on the game since the last save.
There are no programmed events in Village Sim that cause all of your villagers to die. You didn't give a lot of detail on how far you'd progressed in the game, how many villagers you had or what their food supplies were, so I'll give you some general help.
Depending on what game speed was selected when you left your game overnight, what the available food supply was, how much you had expanded your population, and whether or not you had any trained doctors, it's conceivable that illness or starvation occurred. The safest thing to do is to set your game to slow speed overnight (I know many people who pause it, although that shouldn't be necessary).
The early part of the game should be focused on establishing adequate food supplies and researching additional harvesting technologies. If you breed too many villagers too soon, or divert your villagers' efforts away from survival (like trying to complete the puzzles too soon), you will have trouble keeping them alive.
