My hard drive failed the smart test and has an extremely high reallocated sector count (133). and it needs replacing. there are couple of things i can't seem to find the answer to: 1) does this have anything to do with constantly high disk usage on my device ? or is that another problem to worry about ? 2) is this causing my device to overheat ? or my device over heating caused this ? 3) is there anyway i can optimize my laptop to deal with this problem till i get a new hard drive ?
If S.M.A.R.T is telling you your drive is failing, you need to replace the drive if you value your data at all. (DO IT NOW!)
I suspect the reason you are finding an answer to your questions are because the answer is "maybe, maybe not". I'll try break this down below -
Indirectly your constant high disk usage has been putting the system under load, and this means when it fails, it will fail quicker, so your reallocated sector count will go up faster. I do not believe there is a strong correlation between writes and disk failure. (This is partially because I've not heard about it, and partly because of inferences made from Backup Blaze statistics on their drives - of-course, they don't deal in laptop drives. This is anecdotal, and there are conflicting views.)
A typical laptop drive consumes in the order of 5 watts- so this is the maximum heat it can generate, and its doing so over a fairly large surface area. It could certainly be a contributing factor and it depends on your ventilation of your laptop, and ambient temperature. (As a semi-aside, I have a 5 watt LED driving a small salt lamp, and the heat it dissipates is just about enough to stop water from forming in a fairly moist environment, so the heat generated by your drive is non-zero).
The first thing you should be doing is backing up the drive. The next thing you should be doing is checking your backup. I'd not suggest doing anything important on the laptop until its fixed, but if you ensure good airflow through the laptop, and check your power profile to avoid spinning up and down of the hard drive on the laptop. Also, leaving it on a flat surface can't hurt (I'm suggesting that changes of positioning, especially when the drive is spinning cant be good for the drive)