I did evaluate S3 for backups for one project , but concluded that an rsync script would be simpler and more portable.
In the case of things like heroku, how are software updates handled? Do you contact them and say "I want to update to rails version x.x , do it and run these automated tests" or do they just do everything on a schedule?
In other words, if you want an extra feature that is only present in a newer version is this possible? Also what I would worry about it them doing a random upgrade at an inconvenient time (like during a launch of something) and it breaking something subtle.