Heh, thinking of exactly that, I was going to write about how turkeys are fed and well taken care of by humans for 99% of their lives, until that last day, when things take a turn for the worse.
That said, things will run just fine, even with downtime, if you're not depending on the machine in any way, don't have any local storage, and are capable of switching over to other systems. However the lack of downtime might lull people into not worrying about that stuff.
You raise an important concern, but I wonder if the analogy is the right one. For a lot of startups/businesses, a period of downtime (in hours, not days) is not death. It might suck, but you won't die. In the late '90s, Ebay was down for three days straight (!) and it's still doing OK.
I will be surprised if Amazon doesn't work out the reliability issues anyway, given the massive resources and smart people it has available to it.
A bit of downtime is certainly not a catastrophe, but it might turn into one if you lose a bunch of data because you weren't properly shipping it elsewhere.
A much more sane response to the overwrought fears of EC2 downtime. If you don't know your hourly/daily income rate (often $0), then you can't even correctly value uptime.
Thats just it. Downtime is expensive if you rely on your web site to make you money. If you are a small eCommerce shop with all your eggs in the EC2 basket, downtime can be expensive.
The reliabilty concerns are overstated. As long as one accounts for the lack of persistent storage, there should not be a problem.