If you just want a single Machine then that might actually be the better approach, to be honest… Fly.io’s Machines platform is mainly intended for people who want to spread multiple compute nodes across the entire globe and/or do clever things with the Machines API.
The new Sprites concept will probably be a good alternative for the more commonplace single-node setting, once they stabilize a lot more, 
…
(It says “sandboxes” in the tag line, but they also intend these to be used for the kinds of small, relatively casual servers that lots and lots people could really benefit from, if the barrier was just dropped a little.)
Exactly. The persistent volume disappears when the underlying hardware dies (which of course it will someday).
[You can search the forum archives for his username to see several specific “bad news” cases… It really takes people by surprise.]
The Machines platform largely assumes that you’ll have ≥2 copies of each volume, with replication handled by you at the app level. (There are halfway comprises that can be made instead, sometimes, but you’re going against the grain then.)
Possibly even 40×, if you have a low-traffic site with auto-stop enabled.
The forum has several fans of Supabase’s free tier, which might also be worth assessing. (I’ve never used it myself, though. I lean toward LiteFS and similar on Fly.io, although I’m a huge fan of Postgres for workhorse local databases…)
The database side has always been a shortcoming of Fly.io, really, although at least now the mid- and high-end tiers are well served…