If you want to get the lowest pricing on EC2, use a spot instance request where your bid price >= standard pricing (i.e. 0.085/hr for m1.small). This will essentially get you a spot priced, but indefinitely persistent instance and you'll typically pay 1/2 or less than the standard pricing. I've had a spot instance running for 3 months paying about 45% off list price on average.
It could, but it is extremely rare. Check out http://cloudexchange.org to see historical pricing. A spot instance cannot be changed to standard pricing.
