Earlier quoted context omitted.
That isn't very specific about how it works ("defends against the most common, frequently occurring network and transport layer DDoS attacks" whatever that means), but it sounds like they're going to drop weird looking packets. The problem is, one of the more common types of DDoS is that the attacker has a botnet with a million machines in it and has them all make legitimate requests to your service all day, thereby…
Why is this unlikely? If you do it several times then they will start to get annoyed and say no but a service like AWS is all about the long term customer relations. I've had bills of ~$1k refunded even though I'm a ~$3 p.m. user.
Do the math on how much the S3 bill would be if a million bots each with a 100Mbps cable connection would DDoS you for a month. A thousand dollars is too low by how many orders of magnitude?
You might get them to waive that, maybe, or maybe not. Even at their cost they'd never make it back from you. Do you have any guarantee that they will? What happens if they don't? What happens if they do it once, but the attack hasn't ended?