I'm not sure if this is a bug or I am just supremely unlucky.

I got my first frigate when my party was level 2-3 and I did a bunch of exploring with it. Then I X-it'd it to kill some monsters on land and while I was on land a whirlpool came a long and ate up my frigate. I thought it was no big deal, another pirate ship will come along eventually. I have played for several hours since then without seeing another pirate ship. My party is up at level 12, I have over 20,000 gp I'm dying to spend in Ambrosia, and I've run around the continent what feels like 100 times looking for another pirate ship with no luck.

Has anyone else experienced anything like this?

I know how you feel. My solution is to simply cheat, as described here:
http://www.gog.com/forum/ultima_series/ultima_3_where_are_all_the_boats/post20

Thanks, I ended up doing this. :)