I don't even understand how things went wrong, but here's what's happening.
I'm running linode 1gb, ubuntu+apache+mysql+php5, all installed and optimized per linode instructions.
Everything was working great till today, once I started to get these emails "notification threshold (1000) for disk io rate by averaging 5351.16".
Today I transferred my main, biggest site here, and 2 hours later, troubles started.
All sites are wordpress, and it can't connect to db (all sites), then mysql crashes, everything becomes slow (even terminal, it takes 5min to login via ssh and switch to root).
When I run service mysql status, I get this: post-start process 16000. I tried optimizing db's with: myisamchk --recover /var/lib/mysql/*/*.MYI, didn't help.
What could be the issue? I can't even start iotop now, takes forever...
Here's the screenshot once it's all slow:

and here's when it works (guess mysql is dead here):

Can someone help, I can't catch a breath today...