The one who's travelling has the weakest odds of all. The traveler will be in a foreign place with no place to stay. In contrast, the host has no losing cards except some income. The rules should, thus, have been written to protect the traveler at the expense of the host because the host can take more hits from bad luck than the traveler.
If the host really needs to cancel they should have to put the traveler in a real hotel as an upgrade to remove all doubt of the traveler getting into a place that could be worse. They have already received the money from the traveler so they only need to pay for the difference. Just cancelling late without any particular reason could be done but at a very high cost. And if the host's place did burn down for real then a few hundred extra to pay for the guest's hotel for a few nights will surely be a negligent cost.