This is a common problem with Just Cause 2. I had the same problem (hard, repeated crashes to desktop) and now I can play Just Cause 2 for hours on end before running into the crash. It's not the decals (it can still crash with them off); they're just related to the problem and can make it worse, but are not the root cause or the way to fix it.
The problem is that specific graphics card driver builds and Just Cause 2 don't get along. The decals seem to more frequently trigger the part of the driver that causes the crash, so disabling decals can help reduce crash frequency, but not entirely eliminate the crashes.
The fix is, unfortunately, to downgrade your video card drivers pretty much at random. The exact versions reported to work longest without a crash differs depending on who you ask, so you're on your own to find one that works for your exact system.
I'm currently running nVidia's ancient 314.22 because of this problem. In combination with disabling decals, that was the only version that gave the longest spans of crash-free play for me (at the time, it was just one version back to downgrade to), and I've avoided upgrading ever since. I have to emphasise: I don't recommend this specific version as the fix, because whatever the bug is seems to depend on your exact system and card, so you will have to experiment.