If you started out with a VPS, and kept on upgrading it as needed, eventually you would end up with the only VPS that fits on the host. At this point it would be worth considering switching to dedicated, but even then there could be some compelling reasons to stick with the VPS.
The difference between a dedicated server and a server running one VPS which is allocated all the resources would simply be the overhead of virtualization itself, and there might be some value in reclaiming those few percent. However, at this stage you already have a very large VPS that has obviously done well for you and got you this far, so it might be better to stick with what you know works rather than chasing a little performance.
Another aspect is cost. It is actually easier for a hosting provider to manage VPSs than dedicated servers. Providing backups is certainly easier, as well as upgrading you to newer hardware as appropriate, or onto a spare host should there be a hardware problem. If it is easier then it is probably cheaper. I would expect a VPS plan so big that it would take up a whole server to be cheaper than renting that server directly (assuming the hosting company uses its own equipment of course).
As virtualization gets better the advantage of direct access to the hardware becomes outweighed by the convenience and cost reduction of managing a virtual infrastructure. Of course if you have unusual requirements such as lots of one resource (disk/memory/cpu), then being shoehorned into a typical VPS package just might not make sense. There is a lot to be said for the flexibility you get with dedicated/colocation. If you don't need that level of customization then I see little sense in not going with a VPS.
Jim