Hello all. I'm the developer responsible for the AlarmClock. There is indeed a problem with alarms. It is intermittent, and hence hard to track down. It looks like there are cases where either the system fails to launch the clock's AlarmAlert activity, or fails to play the audio, or maybe both. We are working on a fix. I'm not sure yet when we'll get it into an OTA, but I will let you know when it is going in.
Also note that alarms are canceled five minutes after they start playing. This is to avoid running down the battery (and bothering the neighbors) when a phone is left unattended. We are increasing this timeout to 10 minutes, for the heavy sleepers. There will also be a message on the alert screen when the alarm is canceled, so it won't be mistaken for a bug.
Thanks for your help tracking this problem down, and sorry for the hassle. I'm very aware how much people depend on this app.