Other than getting a credit card with a minimal limit and using it exclusively for online purchases, what other strategies could be employed so as to avoid identity theft and credit card frauds?
Some credit card companies, like Citi, offer the ability to auto-generate a one time use credit card number linked to your card.
Otherwise, sticking to trusted, mainstream sites is your best bet. The Amazons of the world (probably) have more oversight on their employees.
But really, it is a crap shoot. Once you send your information over the Internet, you do not have any real guarantee of what is happening to it.
Why do you care? Any credit card these days has zero fraud liability. Even if your account number is stolen, you're not on the hook for anything. If you see a bogus transaction, call your CC company and report it. You'll get refunded and a new card will be issued.
Just be sure to use a Credit Card, not a Check/Debit Card, so you have a buffer between the transaction and your checking account. If your Check/Debit card gets hit with a fraudulent transaction, you may be in trouble when a rent check bounces.
Make sure you review your statements every month to catch fraudulent transactions (good point MrChrister). It is a really good idea to use something like Mint.com or Quicken and check it weekly/daily so if a fraudulent transaction shows up you can catch it quickly. Mint can send you an alert on large transactions, which can catch something major, but smaller transactions may slip through, so review the list regularly.
Have multiple credit cards and spread your spending across them. That way if one gets closed down due to fraud you can use the other one until a replacement arrives.
In addition to the good advice already mentioned, with any site you're buying things from, start by making sure the URL starts with https. This will at least encrypt the the information you send.
Another purchase option I see more and more is the use of PayPal. Going this route means that none of your credit card information goes to the seller--it stays with PayPal.
Edit: Commenters on my answer make a good point in indicating that PayPal isn't regulated the same way that credit card companies are, so protections aren't the same. While this is true, using PayPal doesn't mean you're completely devoid of protection. It will be worth your while to read the page on PayPal's site dealing specifically with purchase protections.
Who cares? Stealing your credit card info isn't identity theft, it's credit card fraud.
The fraudsters are playing with the bank's money, so your only problem is to monitor your statement and report instances of fraud. When you report it, you get a new card and account number. I had a waiter in a restaurant skim my card. I discovered it on the next statement, made 1 ten-minute phone call, and that's about all there is to the story.
Now if you are using a debit card online, that's a whole other story, since there's a real risk that you'll bounce a check before realizing what's going on.
If you use credit cards with a contactless payment RFID tag in them, be careful where you place them about your person. As (in the UK) any payment under £20 does not have to be acknowledged by the cardholder, criminals could use a portable RFID scanner on your wallet in your back pocket to scan your card details or make bogus charges. Either keep them in a breast pocket or stump up for an RFID blocking wallet (I've seen ones for as little as $20).
Of course, this is a rare form of crime at the moment, but as the world moves away from magstripe & signature or chip & pin, occurrences are only going to increase.