I once service a compressor in an old bank that was part of the elevator system. The compressor was 200 years old and still had the original tank. Because of its location it constantly had moisture in the tank and rusty water would flow out of it. That was more than 10 years ago and it is still in service.
I will occasionally flush my compressor tank with alcohol to remove the water. Once flushed I let it run with the drain valve open to remove the vapors. The sludge and sediment from the moisture doesn't do much internal damage, it just looks yucky.
They do make lined tanks, but believe or not they fail at a slightly higher rate than none lined ones. A piece of debris will puncture the lining and the moisture becomes trapped, thus causing a cancer inside the tank. Eventually it fails in that spot.
Though most compressor failures don't occur with the tank, rather the plumbing to and from it.