If you're a language like Node.js then horizontal scaling makes a lot of sense, but I've been working with Rust a lot recently. And Rust is so efficient that you typically end up in a place where a single application server can easily saturate the database. At that point moving them both onto the same box can start to make sense.

This is especially true for a low-traffic apps. I could probably run most of my Rust apps on a VM with 128MB RAM (or even less) and not even a whole CPU core and still get excellent performance. In that context, sticking a SQLite database that backs up to object storage on the same box becomes very attractive from a cost perspective.