<p>Does anyone have experience deploying GWT apps to EC2?</p>

<p>If I were to install tomcat or apache on a ec2 instance, could I have users connect directly to a url pointing there?</p>

<p>Would that be cost effective, or would java hosting services be best?</p>

<p>Is there any downside to hosting the edge HTTP server on a regular hosting service and have that direct requests to EC2? Performance ever an issue here?</p>

Yes, you can host pretty much whatever you want, as you effectively have a dedicated Linux machine at your command.
As I last recall, the basic rate for an EC2 instance, on their "low end box" worked out to around $75/month, so you can use that as a benchmark against other vendors. That also assumed that the machine is up 24x7 (since you pay for it by the hour).
The major downside of an EC2 instance is simply that it can "go away" at any time, and when it does, any data written to your instance will "go away" as well.
That means you need to set it up so that you can readily restart the server, but also you need to offline any data that you generate and wish to keep (either to one of Amazons other services, like S3, or to some other external service). That will incur some extra costs depending on volume.
Finally, you will also be billed for any traffic to the service.
The thing to compare it against is another "Virtual Server" from some other vendor. There is a lot of interesting things that can be done with EC2, but it may well be easier to go with a dedicated Virtual hosting service if you're just using a single machine.