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But the probability that none of the accounts will use 0.001% of the resources will decrease rapidly the more accounts on the server.

True :). I read Web Hosting Talk fairly often as well (in fact at one stage I was planning on trying to setup a web hosting business) so I guess what it really comes down too is not overselling as such, but how well the hosting company can manage its servers to make sure they all run as well as possible.
 
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