I had always wondered whether it is possible to offer unlimited bandwidth and space for a cheap fee. Do you think the web hosting companies could offer unlimited bandwidth to all its users.

Not a chance, what they do is mention Unlimited Bandwidth to entice you to sign up. I bet if you start hosting large files and use more than 2GB of download bandwidth per day they will spit there dummies out!. Your subject to fair usage policy anyway as with anything internet based I'm afraid. Your better off with services that are not unlimited as they are more reliable as they control what people are allowed and can provide a much more effective service. Plus you know where you stand