Does "Mount volume as removable medium" reduce the chances of data corruption with a TrueCrypt encrypted USB hard drive?

That corruption may happen if you disconnect your drive before all of the data was written. TrueCrypt acts as a middleman, encrypting/decrypting data on the fly as it is read/written. It does not affect the way your OS or programs write to the disk.

So, if some program write()s a lot of data without flush()ing, and you disconnect that external hard drive, some data may be not fully written at that moment. But it has nothing to do with TrueCrypt.

If windows, or the program you are using doesn't treat removable media in some special way, then there is no difference how you mount that drive (beyond those pesky folders).

According to TrueCrypt FAQ if you use your USB drive safely as you would for any other data storage, things will work fine.

Can I unplug or turn off a hot-plug device (for example, a USB flash drive or USB hard drive) when there is a mounted TrueCrypt volume on it?

Before you unplug or turn off the device, you should always dismount the TrueCrypt volume in TrueCrypt first, and then perform the 'Eject' operation if available (right-click the device in the 'Computer' or 'My Computer' list), or use the 'Safely Remove Hardware' function (built in Windows, accessible via the taskbar notification area). Otherwise, data loss may occur.

Based on your question,
I wonder if the BootIt tool might be usable for you.
Here is a reference discussing it with TrueCrypt.