An EC2 instance is like a remote computer running Windows or Linux and on which you can install whatever software you want, including a Web server running PHP code and a database server.
Amazon S3 is just a storage service, typically used to store large binary files. Amazon also has other storage and database services, like RDS for relational databases and DynamoDB for NoSQL.
=>Although your title suggests that you are asking about the difference between Amazon S3 and Amazon EC2 instance but in post you said you want to use it for serving your clients/users so I would point that if you want a CDN (Content Delivery Network) then Amazon S3 is not a true CDN. S3 was designed for content storage. The correct Amazon service to use for content delivery is Amazon CloudFront. Rest the answer of your title has been asked. May be it help someone in future.
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