Interesting comments below. Apparently my point wasn't as clear as I hoped. I'll try once more--in the runway portion of a startup, especially when bootstrapping, I am willing to completely ignore scale if I can gain an order of magnitude in cycle time for experiments.

AppEngine offes a different tradeoff--easy scaling but relatively slow experimentation. My comments about the fit of AppEngine only apply on the runway. Once you get to climb out (validated product/validated business model/rapid growth), AppEngine is a great fit.