> The downside of hosting things all in the same domain is that cookies are shared between them, so a vulnerability in one site (e.g. XSS) leads to compromise of all sites. Choosing different domains means they are sandboxed and safe from each other.

I believe this is incorrect. Cookies should only be shared (by default) if the domain matches exactly, which is why it's best practice to use a www subdomain instead of the domain alone. For example, www.example.com cookies will not be shared with test.example.com by default, though this can be enabled. See here for a fuller explanation: https://stackoverflow.com/a/23086139