In practice they will have to drastically undersell their hosts in order to guarantee the burst-capacity.
If you need to reserve 8G for my 256M instance because I could burst to 8G at any time - then why not just sell me the 8G instance directly?
Perhaps they have some really interesting use for this "volatile" spare-capacity (something like the EC2 spot-market?), but that seems like an awfully complex endeavor.