Bad luck Ed.
And to think that I know of some people running hot masternodes on spot instances. Lets hope they've got backups

Are people still running hot masternodes? Why?

I'll propose a two part answer and you can work out whether its a good idea or not
1) If you really know what you are doing, there is minimal risk to running a hot masternode.
2) Setting up a hot master-node (especially if you are setting up lots via scripts and AMIs) is much simpler than a cold masternode.
Can you imagine setting up 50 cold masternodes? It'd be a nightmare.
It's not that hard, and with that much money at stake, jeepers, take the damn time! When it all gets stolen, it'll be a PR nightmare for DRK. "masternodes unsafe, millions lost!" Gosh, hire one of our guys for the little they ask, and have them help you set it up or something, but don't leave a hot wallet on a server! Please!
Trust me Tante, I'm a cold node man all the way. The fact that I put 10 masternodes on each server is another reason why I like to keep things airgapped
EDIT: You make a very good point. I paid Ghostplayer to walk me through my first few masternodes. Worth every duff. The fact that I do things differently now is just a reflection on my love of experimentation and efficient solutions.