So maybe we should make our telephone systems encrypted and our phone numbers could be our public keys. Then distribute the phone numbers according to population density and Benford's Law.

You are correct, the Sun will swallow the Earth when it becomes a Red Giant. The hydrogen won't completely run out. There will still exist a hydrogen/helium shell surrounding a carbon/oxygen core. The carbon/oxygen core of the Sun will be much more compressable then say the iron core of a star going nova. Instead of a complete gravitational collapse (and subsequent shockwave), the compressed core will increase in temperature and ignite the hydrogen/helium shell which will cause it to slowly expand and cool. The electron degenerency pressure of the core will prevent its collapse and transfer energy from gravitional compression back to the surrounding shell as heat. The Sun will lose its outer layers, but very slowly. The core will be all that is left (a white dwarf).