Is my hard drive failing?

I'm beginning to worry about my ~3yr old WD Green drive. In the last few days i've noticed that my media player is acting weird, it won't move to the next track after a song has finished and also won't play new songs when I double click.

So, I downloaded the "smartmontools" package and used "sudo smartctl -a /dev/sdb2" to check out the drive. Here is a snapshot of the output:

    SMART Attributes Data Structure revision number: 16
Vendor Specific SMART Attributes with Thresholds:
ID# ATTRIBUTE_NAME          FLAG     VALUE WORST THRESH TYPE      UPDATED  WHEN_FAILED RAW_VALUE
  1 Raw_Read_Error_Rate     0x002f   200   200   051    Pre-fail  Always       -       0
  3 Spin_Up_Time            0x0027   164   163   021    Pre-fail  Always       -       6758
  4 Start_Stop_Count        0x0032   099   099   000    Old_age   Always       -       1353
  5 Reallocated_Sector_Ct   0x0033   200   200   140    Pre-fail  Always       -       0
  7 Seek_Error_Rate         0x002e   100   253   000    Old_age   Always       -       0
  9 Power_On_Hours          0x0032   092   092   000    Old_age   Always       -       5846
 10 Spin_Retry_Count        0x0032   100   100   000    Old_age   Always       -       0
 11 Calibration_Retry_Count 0x0032   100   100   000    Old_age   Always       -       0
 12 Power_Cycle_Count       0x0032   099   099   000    Old_age   Always       -       1201
192 Power-Off_Retract_Count 0x0032   200   200   000    Old_age   Always       -       61
193 Load_Cycle_Count        0x0032   200   200   000    Old_age   Always       -       1353
194 Temperature_Celsius     0x0022   124   112   000    Old_age   Always       -       26
196 Reallocated_Event_Count 0x0032   200   200   000    Old_age   Always       -       0
197 Current_Pending_Sector  0x0032   200   200   000    Old_age   Always       -       0
198 Offline_Uncorrectable   0x0030   200   200   000    Old_age   Offline      -       0
199 UDMA_CRC_Error_Count    0x0032   200   198   000    Old_age   Always       -       3311
200 Multi_Zone_Error_Rate   0x0008   200   200   000    Old_age   Offline      -       0

I'm worried most about the "Pre-fail" rows.. does this mean that the drive could fail at any time or what?

If you read the column headers, you'd see that pre-fail is the type of statistic that's collected not the status. The When_Failed column being empty should also give you some hints about whether or not anything has failed (nothing has).

When in doubt, read the manpage or look for documentation on your problem.

Each Attribute also has a Threshold value (whose range is 0 to 255) which is printed under the heading "THRESH". If the Normalized value is less than or equal to the Threshold value, then the Attribute is said to have failed. If the Attribute is a pre-failure Attribute, then disk failure is imminent.

So as long as the normalized value is higher than the thresshold value there's nothing to worry about.
Source: http://smartmontools.sourceforge.net/man/smartctl.8.html

Your hard disks seems fine. No reallocated sectors, no other failed columns. To be sure. try to do a fsck and a hard disk self test: smartctl -t long /dev/sdb - this one will take some hours. You will be able to read the results using the same command you used above.

Smart is per disk, not per volume, so pass the drive, not the volume (though smartctl seems to be clever enough to find your disk anyhow).