It depends on your application and tolerance for failures.
If you are running an oracle database for a financial business, you want expensive servers with hot-swappable parts and built-in redundancy (power supplies, disks, even cpu and memory).
If it's a web server or compute servers with NAS storage, go cheap (on the server, not the NAS) as long as you can tolerate the loss of a box without much impact.
Dont go so cheap that you are constantly replacing bad hardware.
The general rule of thumb for me has been to use raid to protect your important disk-based data, but buy cheap commodity hardware for compute and web farms. Get a good load balancer that can detect when a webserver is not responding and mark it offline.
Real life experiences:
Running oracle on commodity hardware was a cheap solution that we were able to put together very quickly, but a bad CPU fan caused a server crash which forced us to restore Oracle from tape (ugh!).
We replaced 2 high-end heavily redundant machines with 70 commodity rackmount servers. We were able to drop maintenance on the 2 machines and started just buying $2500 'spares'. Over about 2 years, I think we only ever used about 6 of the 'spares' (the real challenge was avoiding deployment of spares for other purposes).