There are ten lost tribes, after the kingdoms split, ten tribes were eventually conquered and taken into exile for their averot, but Hashem promised they would eventually be returned to Eretz Yisrael.
Yes, we do discourage conversion, for several reasons.
1. Being Jewish is hard, it is far easier to be a Ben Noach and will still earn a Goy a place in the next world. So if a Goy will accept such a path there is not reason he shouldnt take it.
2. If a person isnt 100% sincere we dont want him. by discouraging we can discover those whose hearts are true.
3. If after being so discouraged a person still chooses to become Jewish he is all the closer to Hashem for it.
p.s. a Goy who becomes a Jew is as Jewish as someone born of a Jewish mother, even one of Rabbi Kahane's bodyguards was a Ger Tzedek.