First, offloading DB away from your main Website instance has it advantages. You can benchmark separate entities and decide which one to scale.
for 24x7 services, use RDS for your DB. You can create automatic fail-over recovery easily (though still need a bit of intervention) in the future. And you can create a DB snapshot backup independently from your main apps.
If you only need the services every fortnight and data recovery is not crucial, put RDB in EC2 might save you some bucks.
(Update) : Now AWS let you temporary "STOP" the RDS database and start it on demand server, however, RDS will automatically start after 7 days. If you use an expensive RDS instance on demands, make sure you set up notification to handle such situation.
Second, when you offloading RDB away from your apps server, you will get an extra flexibility to load balance your website. You have a choice of using ELB or even SPOT-instance.
For new admin, setting up AWS EC2 RDBMS with SSD driver (e.g. m3.large 2x32GB SSD) is very tempting, since you don't need to deal with EBS IOPS tuning, the ephemeral SSD drive will give you maximum IOPS associated with that SSD. However, you can't expand the SSD. For RDS, you use EBS, when you face of IOPS bottleneck, you can either scale up the disk space to get more IOPS , or provision extra IOPS.