We rent through VRBO. We always stay in an apartment and wouldn't do it any other way. A hotel room for 28 days would drive us nuts!

People we have rented from have one or more units strictly as rental units. They are not renting out their own homes while they are away. (I do know many people where I live that do that, though.)

One can only assume that they are reporting the income and paying the appropriate taxes.

I have looked at AirBnB and it looks similar to VRBO, but we haven't used them as I find that website slow (and we have always been happy with the selection on VRBO).