The drag will slow the angular speed of the ball down over the course of its flight. I've read that a reasonable estimate of the resistive torque would be:
k*FM*r, where r is the radius of the ball, FM is the Magnus force magnitude, and k is a constant for which you can use 1/10. (So, if you were so inclined, you could say
[tex]\alpha = \frac{-kF_Mr}{I}[/tex]
where I is the inertia of the golf ball.)
Note that the direction of the Magnus force is given by the cross product of the direction of the spin vector and the direction of the velocity vector. So the way you have your equations, you are assuming that ithe golf ball has "backspin" only, i.e. the direction of the spin is suck that the direction of the Magnus force is in the direction you have shown in your first post. That's fine, as long as you're aware of the assumption -- you're model does not take into account the effects of any potential "sidespin."
All of that said, I'm not sure what is going wrong with your simulation.
Your numerical integration technique is pretty crude, but as long as your time step is small enough, you should still get a reasonable simulation. I've run code based on yours in MATLAB, assuming that your library of vector functions (like Vector3D_crossproduct and Vector3D_length and Vector3D_scale) works properly (I don't know if you wrote those yourself or if they were from some predefined library). The only thing left is to make sure your initial conditions are reasonable.
P.S. are you still getting that sine wave effect? I didn't see any evidence of that. Again, it could be your sampling time.
Sorry if that's not much help.