How to make my boss understand that a server fault is a bad thing?

You can't "make" your boss understand anything. All you can do is try to present the situation in a way that he will understand -- remember, communication is what the listener does. If the listener doesn't understand, you're not communicating.

We can't tell you how to do that successfully, because we don't know your boss, but hopefully you do. Does he like numbers? Give him numbers. Does he only talk in terms of hard dollar amounts? Then prepare a cost/benefit analysis of the status quo and your proposed solution, showing him how much better your proposed situation is. Perhaps he only responds to doomsday scenarios -- then invoke a digital godzilla to freak him out.

If all that fails, all you can do is put your concerns in writing, explaining clearly and without any possibility of misunderstanding that the current situation is sub-optimal, and that certain problems will occur. Be factual and reasonable. Keep a copy of this missive yourself, at home. You're beyond the realm of reason, into the realm of cover-your-arse.

Put together an ROI. Show your current and projected income on this site on charts (C levels love charts). Also calculate how much money would be lost during an unexpected outage (be honest and figure out how much money you make during peak hours. Also figure out how much time you would be down when rebuilding a new system. $ per hour x hours = money lost). Put this up against the cost for a new server. Let the boss weigh out the cost/benefit.

I'd use an analogy of some sort... something along the lines of kitchen staff in a fast food joint maybe.

If you've only got 1 guy making burgers and you get a rush of people then a big queue is gonna form, and people at the back (or just coming in) are likely to walk out because it's taking too long to get served. If he hires another guy, the throughput will double and the chance of people leaving is massively reduced, meaning more sales and more $$$.

You need to show him that the money invested in the new server will be less than the money he stands to gain over, say, a 12 month period.