I think you're not exposed enough to the reality of hardware. There was no need for the host to come back online at all. I think it was a mistake of Fly.io to even attempt to do it. Just say tell the customer the host was lost and offer them a new one (with a freshly zeroed volume attached). You rent a machine, it breaks, you get a new one.
If they're sad that they lost their data, it's their fault for running on a single host with no backup. By actually performing an (apparently) difficult recovery, they reinforced their customers erroneous expectation that they are somehow responsible for the integrity of the data on any single host.