I agree; every day we stray further from the fundamentals. Xen, and to a lesser extent Docker, and other tools, do help beautify some of the underlying technologies and processes that may have come before them, but that does not make the usability sacrifice justified in situations like these.
I'm afraid I don't have a holistic answer, in this instance, that satisfies the requirement that the developers eat and be clothed, and that the users have an unimpeded work flow. Maybe it's a moral solution needed between all users, of all payment tiers, to agree not to abuse the intent of the permissive nature of the free-tier user agreement. It will be interesting seeing how this plays out.