I don't know if that is practical, there is a lot of other stuff going on in the processor registers and memory is the place that the processor stores information and that is managed by hardware. In reality, storing the key in memory is no different to storing the key on the disk it is the password and key combination that opens the lock.
There will always be a weakness at the point where the user types the password to access the volume. The key must be present to decrypt the data as necessary. As long as the information is flushed from memory on shutdown/removal - perhaps replaced with dummy randomised key. From a forensics perspective, passwords/keys are recovered for TrueCrypt and other hard disk encryption tools using off the shelf software ..
So it is not a unique situation. It is just a hole that is very difficult to fill as commercial programs suffer the same problems.
Please feel free to correct any errors in this post, it is better to learn that to think you know