Bitcoin trading platforms do not need bitcoins accessible by remote servers. They should have a huge portion of the coins in cold storage (not available from remote servers). Also, the storage and attribution of coins to accounts should be done by a server under physical possession/control, so that authentication cannot even be forged in the event of a frontend breach.

There are a lot of things you can do to protect your bitcoins. Having them all on linode servers is the worst thing possible.

http://en.wikipedia.org/wiki/Air_gap_%28networking%29

Yes, bitcoin is definitely not an appropriate VPS to run a bitcoin trading application from where the bitcoins are stored. Stored bitcoins are one of the most sought after targets since law enforcement generally will not investigate. For most web apps, it's an excellent choice.