On several occasions the OS crashes with kernel issues (cannot start init etc.) on nvOC 19-1.4 on an MSI Z170A M5 with 7 1070 GPUs, running on a 32gb USB drive. I've had to rewrite the OS several times. It works fine for a couple of days and then I get the same message again.

Any ideas what could the issue be?

USB keys are good for testing different versions; or for trying out nvOC for the first time.  But in the long run an SSD will likely outlast multiple USB keys.

We miners are spending thousands on our rigs and when it comes to stability and life span we forget the most important part and thats where the OS is installed on, we think small and go cheap with a 5-10$ USB when we can have much smoother system with a 30$ SSD.

Using USB as daily use is not recommended in any distro, The most important  difference other than USB read/write limit is there's no way for a USB drive to mark bad cells as 'do not use'  whereas the SSD may develop bad areas it can ignore them. With a USB drive one cell goes bad and the whole drive is useless.

I'm Not saying that you shouldn't use a USB for bootable OS, just that it's not a good idea to have it as your main boot drive and only use them for diagnostic / testing purposes.
No mining system should be run from USB as a daily hardcore mining system, but run it on usb, test OS and see if you like it, then install it on SSD.

I think mining with nvOC on USB is only good for those who want to mine when their pc is not in use, so they boot with usb, mine for a while then reboot back to their main OS...