They would book you on another flight. They wouldn't necessarily compensate you for the delayed/canceled flight.
Before, I think it was a matter where once the airlines had your cash, they were loathe to give it back.
This really needs to be considered on its own merits. And, in my view, it still happens to warrant a refund, when asked, when the delay is significant.
Conversely, with a hotel, if they overbooked and I cannot stay there, there are usually quite a few locations nearby where I can get a room for a night. I've had this happen a few times and it's never been more than a minor inconvenience.
IDK, they both suck.