And "are they tested for long enough to detect a faulty cooling fan that'll let the primary generator run at normal full working load for ~10mins and are the secondary gensets run and loaded up long enough to ensure something that'll trip ~5mins after startup isn't configured wrong?
While they clearly failed, I do have some sympathy for the architects and ops staff at Amazon here. I could very easily imagine a testing regime which regularly kicked both generator sets in, but without running them at working load for long enough to notice either of those failures. My guess is someone was feeling quite smug and complacent 'cause they've got automated testing in place showing months and years worth of test switching from grid to primary to secondary and back, without every having thought to burn enough fuel to keep the tests running the generators long enough to expose these two problems.
"There is a "right way" to do this …"
There's a _very_ well known "right way" to do this in AWS - have all your stuff in at least two availability zones. Anybody running mission critical stuff in a single AZ has either chosen to accept the risk, or doesn't know enough about what they're doing… (Hell, I've designed - but never go to implement - projects that spread over multiple cloud providors, to avoid the possible failure mode of "What happens if Amazon goes bust / gets bought / all goes dark at once?")
Run the generators and have the grid as backup
And just stop the generators to validate fallback to grid once in a while
It comes down to cost and zoning/permitting. It's much easier to get a permit to run a generator for backup use than to run one 24x7. It's also hard to get a 1-10MW plant which is per-KWh as efficient/inexpensive as the grid (although now that natural gas is about 20% of what it was when I last bought it, gas turbines actually are cheaper than industrial tariff grid power, if you have good gas access...). Being able to actually use the waste heat is what makes the combined cycle efficiency worth it.
There was a crazy plan to run a datacenter on a barge tethered to the SF waterfront, for a variety of reasons, but a primary one being power -- the SF city government wouldn't be able to regulate the engines/generators on a ship running 24x7.