I just haven't seen any web service situations in the past seven years, or so, where CPU was the bottleneck, and I've been involved involved in a lot of web scalability projects (it's what my previous company specialized in).
Are you sure you weren't actually seeing some kind of thrashing triggered by being low on memory or too-slow disk access? For example, when Squid gets overloaded, CPU usage spikes up to nearly 100%--but increasing the speed of the CPU does nothing to make things go faster. You have to give it more memory and more disk throughput. The reason it looks like a CPU usage spike is because the select or poll loop is so busy waiting for file descriptors to be ready (not an entirely accurate description...but it should give you the gist of it if you've ever done any concurrent programming in C without using threads). But maybe PHP and Ruby can work the CPU in pathological ways that I've not seen...modern CPUs are just so damned fast, it's hard to imagine.
(And, technically, there is still debate about whether the universe is infinite or not. And, our universe may yet reduce to a singularity. Just because it hasn't happened yet, doesn't mean it won't. The universe is tricky like that.)
[Matter could still be finite in an infinite universe. And even with infinite matter flying around - gravity gets weaker with distance.]