Amazon offers two instance types on EC2: 1) On-Demand and 2) Reserved. After reading the docs on these, I don't really understand the difference from an end-user perspective. More specifically, I'd like to know the answer to this question: is one or the other better for web applications?

Based on their names and descriptions, it seems as though on-demand instances may get wiped away from the server altogether if they're not in use which means that they need to be restarted when a request finally does come in. That seems like a pretty bad thing for a website. Am I just misinterpreting the docs?

Thanks!