This is still a bad deal. You're moving from one crappily-run, crowded ghetto to another crappily run, crowded ghetto that won't even let your site use 10% of a server's CPU without shutting you down.
They're better off with free blogs from blogger.com or Tumblr.com or WordPress or anything, really.
If a site is big enough that it has trouble running on Dreamhost then it already had trouble running on Geocities.
Good marketing on Dreamhosts side..
I guess my problem is that marketing is the only thing Dreamhost is good at.