I've been using virtual hosting from BlueGravity.com for a few years now, and have never had a problem. They host over 100 domains for me on a shared server, including two Threads installations, Photopost, and a dozen or so mySql databases for other purposes. I also run the "RetroStats" service which has been discussed here, and there's no server lag.
My 100 domains names, 1+ gig of storage, and 80 gigs of transfer cost me about $275 per month. I can count the minutes of downtime my sites have had in the last two years on one hand.
I've been with a number of hosting companies, and BlueGravity is really the tops in my opinion. I don't see any advantage for me to move to a dedicated server at this time, because I can't imagine the performance would be any better.
My two cents...