S3 could do the exact same thing tumblr just did (though for different reasons, granted). This is the risk of the cloud in general (or really of outsourcing ANY labor in general) and is not isolated to tumblr etc. More a question of where you draw the line in terms of price/risk.
The problem is that Tumblr is a freemium, and most users are not Tumblr's customers, but rather their product.
By using S3, you are Amazon's customer. And my whole point is not that you should host it yourself, but rather that you should use services which makes it easy for you to migrate, in case shit happens.
Setting up a Wordpress blog is trivial, lots of alternative providers other than Wordpress.com are available, doing backups from time to time is also trivial, and if you own your own domain, restoring your blog can be done in only a couple of hours tops.
The only reason to use something like Tumblr (IMHO) is the ease of setup (that becomes painful once you want to customize), and the social aspects of it -- but nothing stops you from automatically sending all your links to be posted under your Facebook/Twitter account; and you can give users the option to comment under their Facebook/Twitter ID -- as long as you keep the comments / the articles / the domain, I don't see a problem there.
I think there's a place where "freemium" is the right fit... if you have non-essential content, or don't spend much time or effort on your web properties, it's probably an ok thing.
Once you have anything worth backing up/restoring, you should start paying for what you use, because being a customer means something (http://news.ycombinator.com/item?id=1684732 ... "If you're not paying, you're the product").
There are those who can't pay, and for that reason I do think it's good to fight this kind of blatant identity-theft.
Still a lesson: If you can afford it and if you have anything of worth on someone else's servers, you should be paying for that privilege.
