If you take a look at our benchmarks, you'll see that with RAID you can get 100 MB/s of seq reads (or ~5MB/sec of random reads). Even on a really bad day, speeds will only fall to around a third of that.
While that's not the fastest thing in the world (e.g., a good SSD will outperform a 16 drive EBS Raid for most workloads), I don't think it's fair to characterize it as 'slow as molasses'.
Most people are probably using EBS to run a relational database, or something which will be doing random reads more likely than sequential reads. And speaking from experience, a 4 drive EBS raid couldn't even match the performance of a 4 drive RAID-10. Once we started adding SSDs, the gap widened significantly.
While that's not the fastest thing in the world (e.g., a good SSD will outperform a 16 drive EBS Raid for most workloads), I don't think it's fair to characterize it as 'slow as molasses'.