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If you could use the unique, generated key only once, what would be the harm in not letting them time out?

I guess e-mail sniffing could be a risk... but if that's an issue then we have larger problems.

Ideally, you want both. The link being clicked on twice is a clear red flag for a problem, but if the user requests a password and then for whatever reason doesn't click on the link that quickly, how are you otherwise going to know who's done the interception? In theory your legitimate user will be clicking on the link quite quickly (because they know when they requested it after all), so combining both increases your security.

It seems to me that there would be a benefit in checking ip addresses so that you could only click the link from the same IP that requested it. That way snoopers have even more work to do.

Not necessarily a good idea. On an average working day I'll probably use 5 different machines; I could very well trigger an action on one, go off to do something else while waiting for an email (if it wasn't instant, these things often aren't) and come back to it on a different machine altogether.

OK I'm unusual in my usage habits, but I suspect a complete IP filtering (at least without a warning about it) would cause issues.

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