Soil movement is the cause of most pipe failure, and it's inablity to move with soil. Drying and cracking is one movement, but getting wet and freezing is when most of your damage will happen. That's a very quick movement in the soil, and also, a very powerful movement.
Most water utilities use gasketed water pipe. You just grease the ends and push them together. This allows the pipe to move in small amounts with the soil around it.
Poly pipe is famous for failing. It was an idea that was tried and failed. Lots of guys use it for their well systems, and home use, but it's one of those things that you just never know when it's going to go bad on you. From what I understand, the Water Utilities have quite usining it a decade ago, and are now running crews full time to deal with the never ending repairs on what they did use.
In CA, where I'm from, we had to surround the water lines with sand. The pipe had to lay on a bed of sand, and then sand was put in over top of it. The pipe had to have sand all the way around it for so many inches. I forget the number, and it varied with location, size of the pipe and if it was a puplic water line or private.
When the earth moves, the sand allows the pipe to remain in place. It also protects it from rocks that might be in the ground, that may wear on the pipe over time. I've never seen rock damage, or met anybody in person who has, but it's a concern that you might have.
As for the advice to enclose it in another larger pipe. I would not do that. Water preasure changes all the time. There are surges that will flex a pipe that will allow it to move if it's not solid in the ground. If the pipe can move around inside another pipe, it will never stop moving. Even worse, when it does break, how will you know where to look for the break?
Good luck,
Eddie