I was having this debate with my current host. They're moving me to a new machine that'll be setup as a VPS with 30gb of space, 384mb of ram (???grr!) w/ Ensim, 85gb of transfer for $140 a month! That blows IMO.
Comparing to rackshack I could have a dedicated p4 with 80gb space, 512 of ram, 700gb transfer, w/ ensim for $150 a month.
Obviously my current host's argument was that rackshack bases their business on numbers. their servers are unmanaged, and their solution to everything is 'format and reload'.
The problem is I don't know linux well enough to get something from rackshack and know how to setup and run everything..

So I'm stuck paying the high prices.