I'll jump back into this discussion at this point, but make some comments to several posts that have occurred from my last post.
I prefer the Linux VDS because that's what Moodle is developed on. I have always had a Linux server (both hosted and virtual) with GoDaddy, and they works fine and are very reliable. Since I have not had their Windows products, I can really make a fair comparison.
Visvanath, I think GoDaddy attracts people for several reasons: 1) price, 2) performance, 3) reliability, and 4) support. Yes, there are alternatives. Some of these alternatives will provide more hand-holding than GoDaddy will. But GoDaddy does provide a very stable platform. GoDaddy, especially when you move up from a hosted to a virtual server, expects you to do more on your own. Have you had any good experiences with other inexpensive hosting companies? I see that some people have tried using 1&1.com, for example.
Hal, yes, the cost difference is significant (from $6 to $50 or so a month). I too am somewhat of a freelancer with Moodle. My school provides Blackboard, so everything that I do with Moodle is on my own. But using Moodle on your own might provide you the opportunity to offer school both your content and your own CMS - the school doesn't need to provide you any IT support (once you get good at this stuff, of course).
I was once considering moving away from GoDaddy, and came across a company called TMDHosting.com. Right now, I have one of their $5/month hosted accounts, which I primarily use to hold all of my videos (they say unlimited storage.) They claim to know Moodle. When I purchased their hosted service, I asked them to install current versions of PHP and mySQL, and they did! GoDaddy, by comparison, won't do this. I like to install original copies of Moodle on this account, just so that I can see what each version looks like. I can do this! For example, I just installed the latest Moodle 2.4 yesterday (click here). I don't use any auto-install scripts anymore, I do this from scratch and it only takes around 15 minutes. TMDHosting would never recommend running Moodle on their hosted account (they too want you to buy their Virtual Server), however, for a small site, or to learn, this could be fine (in my opinion). By the way, I am an "affiliate" with TMDHosting, so if you use my last name when buying, you can get a little discount (I think). Most server companies try to promote their products like this, and I am not in any way associated with TMDHosting, I just said "sure, make me an affiliate). Over the last year, I have done some experimenting with TMDHosting and they have provided some great support (all via tickets, no phone support).
I agree with Ken, you want to be able to run the latest versions of Moodle. Probably this weekend I will upgrade my production Moodle, which is on my GoDaddy VDS, to Moodle 2.4. I am waiting form my courses to end tomorrow. I am a little conservative about when I decide to upgrade. I typically upgrade two or three times a semester.
GoDaddy says that they provide the latest versions for WordPress because of some special arrangement that they have with WordPress. They said that no one from the Moodle organization has set up this arrangement with them, yet.
Hal, I have found the learning curve a welcome challenge.
Derek, if I wanted to, I could probably host Moodle courses and even make a little money doing this. What stops me is that then I would have to really be a Moodle/UNIX administrator, which I am not (I am a professor.) Instead, I enjoy simply sharing my knowledge about Moodle whenever I can. I am always available as a consultant, when needed. But only for small sites with installation requests. For installations at larger schools, they would need to go elsewhere. I would be willing to consult with Moodle specific needs. And I have even thought about writing a book about Moodle (when I find time).
I hope that you find some of this information useful. I try my best to put issues into perspective.