there's nothing cynical about it. Everyone who goes to the conference is going to learn the startup lesson: "don't pay $700 to attend conferences about (essentially) how to bootstrap a company". personally i could only justify that cost if it were extremely good PR for your company.

and forget servers (you shouldn't be paying that kind of money for servers when there are things like app engine/aws/azure). if you've quit your day job, $700 could be food on the table or a roof over your head for a month or two (depending on where you live).

Lean != Cheap. The "Lean" in Lean Startup is more about efficiency and less about money.