That's the beauty of VMs.

Luckily, Amazon is far from the only VM provider out there, so this discussion doesn't need to be polarized between "AWS everything" and "on-premise everything". You can rent VMs elsewhere for a fraction of the cost. There are many places that will rent you bare metal servers by the hour, just as if they were VMs. You can even mix VMs and bare metal servers in the same datacenter.