Take a look at this answer and see if it applies to your situation. If not, good luck finding a $5/month host which doesn't suck. AFAIK, they don't (and cannot, profitably) exist.
Edit: Okay, time to expand on this again a bit.
First, I'll tackle your third question. SLAs: they are... interesting. Here's how it works: no matter what the company says ("100,000%-money-back uptime guarantee!"), every single last one of them will have at least one of these caveats, and most will have both:
- Only downtime in the core network (i.e., the enormous big iron at the heart of the network that never goes down, ever) counts. In most cases, not even upstream connectivity problems count.
- Downtime is computed, refunds are issued, but in no case will liability exceed [monthly|weekly|rarely, yearly] hosting cost. i.e., your, "Here's your five bucks back, sorry about that weeklong downtime," example.
In addition to those, every SLA includes exclusions for scheduled downtime, meaning that, at the end of the day, almost all SLAs are pretty worthless in terms of helping you recover the actual lost business value. And even if none of this applied, it's still messed up; if your solution is down for one second every fourth second, that's much worse than being down for one solid week; in the latter case, customers see you're having problems, and you lose the ones that were ready to buy during that week, while in the former case, all but the most-determined customers won't even bother to continue their visit after a page or two.
What you're looking for isn't an SLA, it's business-continuity insurance. The SLA is just a safety net below that.
As to hosting cost, I'm glad to hear you aren't stuck on $5/month hosting. The question now becomes, what level of effort do you want to expend versus the level of effort you expect from your hoster? At the high end, firms like mine, BlackMesh, provide unlimited support, 24/7 monitoring, managed backups, architecture consultation, and so forth, all bundled into one flat price up-front. At the low end, companies like SliceHost give you a (virtual) box and say, "Go," and everything you want to add to that (backups, bandwidth, storage) is a few (dozen) extra bucks.
IMHO, and with the obvious caveat that I work for a managed-hosting company, most people end up spending more of their time doing (bad, or at least suboptimal) sysadmin work than they buy by using cheaper hosting. The example I like to cite is the hypothetical development shop owner who was going back and forth between using us and a cheaper solution provider that didn't include any support. In the end, he might save $100/month/box across ten boxes, but now one of his developers is almost a full-time sysadmin, so he has to hire a new developer. He saved $12,000/year in hosting fees, and now pays an extra $50,000 or $100,000 per year in salary. And if his sysadmin ever quits (or doesn't know the answer to a specialized question, or is on vacation and unreachable when the server crashes), he's screwed.
Anyway, enough ranting. Basically, here are your options, in order from simplest to "best". All numbers approximate and at the bottom end of the scale.
- Shared ($5/month)
- Cloud ($15/month)
- Slice (as distinguished from VPS) ($25/month)
- VPS (1:1 mapping between virt and host CPUs) ($100/month)
- Dedicated/Colo ($100/month colo, $200/month dedicated)
- Managed VPS ($300/month)
- Managed Dedicated/Colo ($500/month)
- Custom Enterprise Hosting ($100k+/month)
Of these, BlackMesh offers the last three. Feel free to drop us an email ("sales@...") if you'd like any more information on our offerings. Otherwise, best of luck, and let us know if you find a winner in the other categories.