How to deploy Envoy EDS/SDS
Putting it behind a DNS name with a load balancer across multiple SDS servers is a good setup for reasonable availability. If SDS is down, Envoy will simple not get updated, so it's generally not the most critical failure -- new hosts and services simply won't get added to the cluster/endpoint model in Envoy.

If you want higher availability, you set up multiple clusters. If you add multiple entries to your bootstrap config, Envoy will fail over between them. You can either specify multiple DNS names or multiple IPs.