What are the benefits of EBS vs. instance-store?

EBS backed instances can be set so that they cannot be (accidentally) terminated through the API.
EBS backed instances can be stopped when you're not using them and resumed when you need them again (like pausing a Virtual PC), at least with my usage patterns saving much more money than I spend on a few dozen GB of EBS storage.
EBS backed instances don't lose their instance storage when they crash (not a requirement for all users, but makes recovery much faster)
You can dynamically resize EBS instance storage.
You can transfer the EBS instance storage to a brand new instance (useful if the hardware at Amazon you were running on gets flaky or dies, which does happen from time to time)
It is faster to launch an EBS backed instance because the image does not have to be fetched from S3.