We were part of the community test of the Azure Cloud. I can tell you that the ASP hosting of the Azure cloud is very promising. We were able to deploy an ASP app in the cloud with minimal changes to our development strategy.
- The Azure Service SDK only runs in Vista
- We did not test to port an existent application with the Azure SDK, but the actual built from scratch was not difficult.
You can read a few more details in the following link. I hope this information helps you. The short answer to your question is yes, is possible and many people have already done it. It exists, either in Azure or in EC2 (at a different level).