I've gotten the same recommendation from them. I complained because they pulled the network connection on the drive connected to the database and completely torched the drive. They were like: well maybe you should consider running multiple database machines with replication so you can survive the next time we screw things up.
I was told it was to avoid changing my DNS when I spun up a new server. With the load balancer being $50/month; that was the pitch that put me off Rackspace.
I don't know about the poster above, but commonly load balancers can be used to do SSL termination, which can significantly improve application performance.