I'm running 4 m1.small EBS-backed LAMP servers in all 4 regions. I pay about $1/mo for EBS IO (8-11 million IO requests per instance per month). The servers get a few thousand hits per day. The cost of EBS IO should be minimal in most cases. The benefit of EBS versus the local storage you'll get with Rackspace or Linode is greater durability because it is off instance and AWS automatically duplicates the data. If the VM host system fails (i.e. power supply goes bad), you can bring your instance back online within a very short period of time on another host at the exact state it was at the time of failure.