I will respond even though this post is several days old because I actually do this. I have some vpses on Hetzner that run Silverblue no problem. It is not an install option available by default there, but support uploaded an iso under my account quickly when asked.

If you do it, change the active firewalld zone. The default is for a desktop, so not great for vps space.

Agreed on Hetzner, although I have used customer support—to add another distro option. Sent them a web link, and they had it uploaded under my account by the next day.