LiPo's are damaged by being over discharged/used. If they get to under 3v per cell they get unhappy. You can't run them until they "die" like you can NiCd/NiMh. If you were noticing the gun starting to shoot slower, you were unfortunately likely past that point already. That would explain why you got the error when you tried to charge it. Setting it to NiMH to bypass the error likely destroyed the battery. Step one is get yourself a tester or a balancer.
Tester:
http://www.airsoftgi.com/product_info.php?products_id=16336Balancer:
http://www.airsplat.com/kong-power-voltage-meter-balancer.htmlI highly recommend the latter as it's small enough to fit in a pouch on your vest or your pocket, has a nice LCD to show you the exact voltage of each cell separately, and will manually balance and/or discharge batteries. A lot of cheaper batteries aren't properly balanced when you buy them. I also wouldn't recommend charging faster than 1C unless your pack specifically states it's OK.
General guidelines are you get about 1 shot per mAh so you should be getting roughly 2,000 rounds out of those batteries
assuming they have a full charge at start. My general process is check my battery before I start playing and check again every 500-600 rounds or so. I carry a spare battery on me so if I think I might be pushing it, I just swap the battery and check the original at the next break in action. It also wouldn't hurt to charge your batteries up once to full charge, and then test their "endurance" in the backyard. Just start doing mag dumps and checking the battery after each mag until you determine how many rounds you can safely get out of your battery. A few bucks in BB's is worth it to avoid damaging your battery and potentially starting a fire.
This is especially important on smaller batteries. For example the LiPo's in my AEP's are good for about 900 rounds. If I'm running my AEP as the primary, I can go through 900 rounds surprisingly fast.
This is a long article but has a LOT of good info about LiPo's:
http://www.rogershobbycenter.com/lipoguide/