It's definitely weird that cloud costs which is supposed to be commoditized is differing by 2 orders of magnitude. Hetzner/OVH seemed to have solved the hard part of making the service cheaper but just can't solve the easier task of making the platform usable. Why do I need to upload documents for verification. Why can't I try server for 2 hours right after signing up for the service.
Those are part of making it cheaper. ID verification is an anti-fraud measure and ensures that bans stick, which in turn means they don't have to invest so heavily in heuristic anti-fraud and "spam filtering" type work. A delay on provisioning means they are provisioning hardware JIT in some cases, meaning they need less idle float capacity, which in turn drives down costs.
Have been in deep contact with data centre and rental server offerings in the past, there is a crazy large amount of fraud going on, e.g. 2 hours for free means 2 hours free resource to DDOS.
You're basically describing the internet-scumbag use pattern - bounce around providers and servers using nothing for more than a few hours at a time and making tiny charges to (other people's) credit cards that won't trip fraud controls because they look like verification charges.
There are very very many reasons to prohibit exactly that type of usage pattern.
