In a lot of cases it's because they don't know how to build using cloud services effectively so they just spin up a lot of VMs because that's the only tool they know how to use. Running VMs 24/7 is just about the most expensive thing you can do in the "cloud". But doing anything else is "too complicated".
Probably depends on what your business is and the LTV of your customers
May be but not sure. How many Figma type startups out there paying $500k a day? As opposed to just traditional SaaS/OpenAi wrapper. I just don’t see it.