I presume you are using MSSQL?
If you have an application fault on your DB server, your application servers that depend on the DB will fail. This is no different to a physical environment.
If you need a higher level of resilency for application faults consider SQL mirroring.
http://technet.microsoft.com/en-us/library/dd207314.aspx
If you can mirror across the WAN, even better. :smileycool: