You are underestimating the reliability of modern servers by a lot (otherwise your EC2 instances or random VPS would randomly reboot way more often than they do

You are underestimating the reliability of modern servers by a lot (otherwise your EC2 instances or random VPS would randomly reboot way more often than they do since if the server crashes the VM is still gone). Also failed PSUs or hard drives don't require downtime, since those are hot-swappable and redundant in servers. If you want to optimize for (physical) hands-off operation you can even add an extra 1-2 hard drives that are configured as hot spare that the RAID (be it hardware, software or ZFS) will automatically use in case one of the active ones fails. And the performance difference between dedicated hardware (be it dedicated server or your own) can be quite staggering compared to what you actually get from the cloud providers.