You need to use KVM or XEN VPS. OpenVZ won't work due to the type of virtualization it does. Quick google search (old hits) makes it sound like Dreamhost is using OpenVZ or something similar.
So I think your issue is a VPS compatibility issue.
There are cheap VPS in the US on bare specs (ie, 96-128MB RAM) for under $20/year. There are cheap Canadian VPS with terrible stability for about $17.50 USD for "life" at cloudatcost.com.
The best, low cost VPS provider seems to be "Ramnode".