I don't know about your specific failure mode however I doubt it has anything to do with the fuel level in your tank. FYI, many S60s and S80s were manufactured with fuel pumps that are prone to leakage. The plastic housing develops (stress ?) cracks and are problematic. They lose pressure causing hard starting issues. A hint is that sometimes they will start to emit a gas smell inside and/or outside of the car. This is how we caught ours - and yes the top of the housing was cracked and leaking when the shop showed it to me. Our independent Volvo mechanic says it happens all the time and keeps spares as he sees so many. NHTSA has a case open on this : 07V152000 and Volvo will replace them under recall only if you live in Arizona or New Mexico under their campaign number # R176. I spoke to Volvo USA and they claim that the heat causes the problems only in these two states and have refused to compensate me. Additionally, now they are saying it's the additive in the gas in these states. I find both excuses their tech people and management have given me to be less than truthful. Seems like Volvo has gotten great training from FORD Customer Service.

Will it ruin your fuel system? It's a risk, depending on the crud that your local filling station has in its tanks. One of Irv Gordon's tips for getting a million miles on a car is to use gasoline only from a high volume station. The more gasoline that flows through the pumps, the cleaner it tends to be. At least that's the theory.

LOL. The fuel pick up for the pump is at the bottom of your tank, so that any "crud" that gets in there will be sucked up, regardless of the level of the tank.
Your SAAB mechanic thinks the fuel pump will overheat while it is not totally submerged in gasoline. Not true. It may overheat if the filter gets clogged and the pump has to work extra hard, which is what probably killed the S60 pump.

Just change out your fuel filter every time you change the serpentine belt and you will be OK. Driving around with only 2 gallons in the tank will not harm anything, except raise the anxiety of looking for a favorite station and a cheap gas price.

Klaus
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The 164 has a new home, all I am left with are a 95 854T and a 98 V70R :)