We offer our customers the option of managing their own cluster or having us manage it for them. About 80% of our customers choose the first option. In this case, cluster sizing and queue configuration is up to them.
When we manage the cluster, we set up a new cluster for each customer. The node type we choose depends on the customer - for larger customers we'll typically use the DS type nodes (with hard disk storage). The slower I/O isn't a huge deal for us, since getting the data from our database to S3 is usually the bottleneck in the process, rather than copying from S3 into Redshift.