The hardware knowledge argument has become virtually irrelevant in the EC2-world where you can spawn VM pretty much transparently
Right, we forgot, Amazon VMs are magical devices powered by hopes and dreams, rather than CPU cycles like old fashioned "computers" are.
Back here in reality cloud virtual machines are just a shitty containment mechanism that's sort of like an operating system process, only dramatically less efficient. Did you know that Google, not a company exactly famous for lacking clue, doesn't use VMs internally at all? Every internal program runs as a regular operating system process on top of a patched Linux kernel. The system is called Borg and they published a paper on it recently.
Why don't they use VMs, Amazon style? Because VMs suck. Running an entire OS inside another OS just to provide isolation is a great way to waste vast amounts of money and resources. It means sysadmins get to reuse their existing skillset instead of learning some new way of managing software, but that's about it as far as advantages are concerned.
Certainly your Amazon VM will suffer from cache line interference, limited resources, and other things that plague physical devices.