I doubt that's true. More likely it's because lower tier users are almost always disproportionally more demanding of help than higher tier ones. If you're going to make, for example, $1,000/m you're better off getting it from two competent, $500/m customers that don't need much help, rather than 100 $10/m customers who all need their hands held constantly. In Linode's case fewer users also makes contention less of an issue - the fewer VPSs per physical box, the better.

This is not true.

Linode allow you to attach additional IPs to your Linode at $1/month, for example, I have one Linode which has 6 IPs attached for only $25/month. I still can't find a company has this kind of flexibility.

$2 boxes are ripe for abuse and billing fraud.