I know quite a few people still running layered panel - and it's not dried up by a long shot. It's honestly one of the easiest ways to get a high ranking domain (alexa and backlinks). The initial cost is the biggest factor, it's about $300 + cost of dedicated server.
But if you take time to promote it and only offer as much bandwidth as your willing to let users use - you won't have a problem. DDos attacks happen to every host, usually you can deal with that at the server level - so it's not script dependent - use routing if its a single ip or a subnet, a good server host will help you with that.
The biggest abusers that I've heard are phishers and people using torrent scripts. These people are idiots though and they make it really obvious - it's not about bandwidth but the file type structure. Like if you look up the name of hte scripts like torrentflux you'll find them. For phishers it's a bit harder but you just look up clones of ebay / paypal - the easiest thing to do is let people report it to you so have a report abuse link on your main host page or on the bottom of all member pages (but they may not like that so becareful).
The main thing is be weary, but don't abuse the power as admin. You'll alienate your members. The real money comes in ads on 404 pages. Here's how you can start:
just adsense ads at the bottom of the page initially to get members signing up. Put no ads on the frontpage, but place them in the control panel - put as many as you can - it actually makes a bit of money - blend it well. Then after you start to get 10+ signups a day - put another adsense ad on the top of the page. And make sure you have ads on the 404 pages - those can make you a lot of money.
If you get a lot of members, you can remove all ads on user pages and just keep them on the 404. I know a few of the LP admins are doing this and making a lot of money, users are happy they don't have ads on their page and refer you to others then you get more signups, and you make money off the 404 pages (users are prone to this - they have lots of broken links which gets you tos of visitors, also tos abusers that are deleted trickle good traffic).
But you want good members, so have a forum and actually staff it. Let people discuss webmaster stuff and take part in it and help them now andthen. Once you build a community you're site becomes worth 20x as valuable and you can use it to promote affiliate products and other stuff. That's were the real big money is (we're talking $xx xxx). Few want to put time to do this, and their forums go dead.
Anyways the good thing about LP is users love it because they can go right into it and it has a lot of features like cpanel but it's much safer. There you go those are my tips for LP...
