Final answer:
The statement is true; EC2 instances are hosted in Availability Zones which support high availability strategies by providing redundancy and failover capabilities.
Step-by-step explanation:
The assertion that EC2 instances reside at the Availability Zone level, and that it's best practice to architect for high availability is true.
Amazon EC2 instances are indeed hosted within Availability Zones, which are distinct locations within a region designed to provide redundancy and failover capabilities, thereby supporting high availability. To ensure your applications are resilient and maintain uptime, it is a recommended best practice to distribute your EC2 instances across multiple Availability Zones.