So the servo just seems to be the wrong choice.

http://www.servodatabase.com/servo/futaba/s9255

It specifically says nicad batteries only. It is also a heli servo. Pick up something made for 8th scale nitro, as the torque on that is not enough for a truggy anyway. There are many other options listed all over. I personally am not a fan of Savox, but the 1267/1268 seem to be very common choices. No reason a LIFE pack should not work if you are using the proper servo.

Personally, I think if the battery was not kiling the servo, just the forces from the truggy turning was.