Even a lab "up to the quality of a guy running a hard disk recovery business out of his garage" is going to work on images of the disks rather than the disks themselves -- anything less will get all their cases thrown out of court by the defense ("how can you guarantee that you didn't alter the data yourselves?") *and* will get caught by "oh, you entered the wrong password? erase everything!" code. Maybe in 1992, but in 2017 ... that's law enforcement computer forensics 101, day 1. They absolutely will not be hooking up his computer and drives and working on that (unless they need to do so to figure something out, and even then -- it'll have copies of his drives rather than the originals.)
If a police department can't even reach that level ... then they're probably either avoiding such cases entirely, or deferring them to some other, larger and better-equipped organization.
Beyond that ... it becomes an issue of how badly they want the data. The local police department probably can't do too much, but the NSA/CIA/etc. can do a *lot* if they are properly motivated.
(That said, this sounds like a case where they won't be going to any extraordinary technological lengths to get at the data. They certainly do seem to have some friends in the courts, however.)
Now, back to "self-destructing crypto" ... if half the encryption key is on some remote server in Russia that self-destructs if not accessed at least every 30 days, then maybe. (That said ... people would lose their data often under such an arrangement.) If such services popped up and were being actively used, I imagine that the NSA and friends would be working on countermeasures (like compromising that box and looking for other vulnerabilities in the arrangement or simply installing keyloggers where needed), but that would probably foil the local police department's attempts to get the keys.
Of course, simply refusing to tell them the password should also foil them, legally and technically. This ruling is bad, bad, bad ... but I guess fighting child porn is more important than the right to not self-incriminate to this court?