I haven't been to Rock Werchter specifically but I have been to a few other Belgian festivals like Pukkelpop (similar in size).
There's a few aspects to your question
Hands down the camping area. I've seen on the website that all 10 camping areas are located surrounding the festival area so you'll always hear the music even at your tent which is a nice background noise if you're socializing with others. Socializing is a very big part of the camping area and certainly towards the evening you'll be able to sit with most people and act like they're old friends. To me this aspect was one of the best parts of festivals.
Comfort sleeping space
Obviously a hostel wins here though I could sleep just fine in my tent. Just make sure there are no stones sticking out of the ground when you place your tent.
keeping my stuff safe
Festivals come with their own risks. There will be police and security everywhere but aside from some patrolling on the campings there won't be much in that aspect. You can bring a lock but that's not very useful with a tent anyway. What you can do however is rent a locker at a reasonable price (€20 for 4 days).
Easy way to cook food
For safety reasons, gas burners and installations are forbidden by order of the fire department. However, simple camping gas burners with small cartridges will be allowed on any camping other than The Hive.
Generators cause extra trouble for all those would like to catch some sleep and they constitute an additional safety hazard. Leave them at home for they will not be allowed on the camp site.
(Small) fires, torches, candles, cookers, charcoal BBQ, etc.: fire is dangerous, especially with so many tents together. So it is strictly forbidden to makes open fires! The same counts for the festival ground, by the way.
Likewise there is no power supply available.
Cooking your own food will be tricky. On the other hand: festivals are not the time for you to be health conscious so you might as well indulge yourself in our unhealthy eating habits. Something I noticed at Pukkelpop is that a lot of locals create temporary food stands in the street leading up to the festival and camp terrain: people offer hotdogs, hamburgers, fries, etc for very reasonable prices.
Bringing your own drinks on the festival and camp terrain is forbidden and security will search for it, though there are ways around that (if you're male: put cans of beer in the front of your pants). Depending on how innocent you look and how much people there are in line you might be able to get away without inspection.
What is cheap? You're paying €230 for 4 days of festival so I'd say €10-€20 a day isn't much. If you don't buy stuff at the festival terrain (which you most definitely shouldn't), you can get by reasonably well. If you don't mind walking a bit further you can go to a local bakery in the morning though be aware that of the 80.000 other visitors that day, several of them will have had the same idea. I was a bakery 20 minutes outside of the camping area around 6AM and I wasn't the first in line at all.
Considering the prizes of Belgian hostels (€30+ per night), a hostel would be entirely antagonizing this objective. A camping ticket costs you €20 for all nights.