mongrel vs. fcgi

I have a virtual root server (monthly $10) running some RoR projects
with mediocre traffic by using MONGREL.
It ROCKS.

But with every new mongrel instance I am getting closer to run out of
system resources.

The web is full of posts like: FCGI is dead - Mongrel is the way how
to do it.
But then you see a list of great WebHosting plans like this:
http://www.rubyonrailswebhost.com/

According to the reviews, it seems that these people know how to hist
RoR
But they are all using: FCGI

- do you think it is a good idea to get one of these hosting plans?
- does it scale - even if you are getting more traffic as expected?
- are there any other downsides using a webspace hosting over a root
server?

what do you think?