This page on the mailing list has links to cases of people who were caught because of an unknown flaw in Tor: https://archive.torproject.org/websites/lists.torproject.org...

I can't find a link, but I think people have done simulations and the privacy benefits of more hops are not as great as one might think. If you control the guard and exit, then traffic confirmation is relatively easy by just looking at timing and volume of traffic no matter how many hops are in between.