They refer to closures stored on the server. If they don't time out eventually, you have a memory leak.
Yes, but the default timeout is too low. I can rarely get three or four pages deep into HN before the timeout. It seems like this changed recently.
I've noticed the same thing; the timeout value seems to have changed sometime in the past week or so. I now routinely get the "expired link" message after only a little bit of HN browsing. :-(