I run dozens of memcache and hundreds of app servers in EC2, and we haven't seen any evidence of connection throttling. Isn't this just network latency?

If your PHP code can make 300 requests per second, then each request takes about 3.33ms. That's actually quite good if it's going over the public Internet to another data center. If you're getting ~10 requests/sec. across the country, that's about 100ms per request, which again is typical of cross-country latency.

If you need response times faster than that, you need a direct network connection between your app server and your memcache server, and you definitely need to avoid transcontinental network hops.