BannedCR500Riders.com

Ive heard often that high-HP sand drag bikes, even taking croch-rocket motors and using them in a sand application kills transmissions really fast, but the same mods on the street/strip will hold up indefinitely.

I was thinking it has everything to do with the sand paddles. Think about it, the tire only encounters drag when the paddle is scooping into the sand. When you're applying 150HP and a fast spinning tire, you get thousands of small "jerks" sent up the drive line to the transmission.

Could that play into that at all?

yes, and simply the fact that the sand puts a huge amount of resistance on any driveline. Take a sportbike, attach a 2000lb trailer and take it to the drags and see what breaks. Thats pretty much what the sand is doing.
Most failures are actually from shifting errors and clutch failures. if you miss a shift or false neutral, then engauge again while in the sand with 150-200hp being put to the sand it bye bye trans.

The 2-3 shift on my nitrous bike sure aint what it was before the juice....