I love using GAE and got 8 apps running currently. At first the new pricing model shocked me. But please take a 2nd look. Sure it's more expensive than the old model. But you can set the maximum number of idle instances in your Application Settings page. Just set it down so no more that X instances get spun up:

> The Idle Instances slider allows you to control the number of idle instances available to your application at any given time. Idle Instances are pre-loaded with your application code, so when a new Instance is needed, it can serve traffic immediately. You will not be charged for instances over the specified maximum. A smaller number of idle Instances means your application costs less to run, but may encounter more startup latency during load spikes.

There is another setting for latency:

> The Pending Latency slider controls how long requests spend in the pending queue before being served by an Instance. If the minimum pending latency is high App Engine will allow requests to wait rather than start new Instances to process them. This can reduce the number of instance hours your application uses, but can result in more user-visible latency.

So if you are fine with a little higher latency for your app then you can reduce your bill by a great deal. If you want all that GAE can offer with max. instances available and lowest latency you gotta pay - as you would when you run n instances at another cloud provider.