Clubs don't sign contracts with bands because they are either unprofessional in business practices or because they want to keep the ability on the table of bouncing you if things come up.
I 've played hundreds of clubs on the East coast over the past 3 decades, rarely with a contract, and what you are saying is simply not true in my experience. The majority of the bars/clubs I have played have been around and successful for years (IMO making them "professional") and very few of them had the habit of cancelling bands last minute without really good reason, and even that was VERY rare.
There is no way I have the data to back this up, but I am convinced the amount of money (and in-kind payments like drinks, food, etc that Jive is talking about above) I have lost because of not having a contract in place is not nearly close to the amount of income I would have given up by refusing to do gigs unless there was a contract. If you are a function/resort/casino band, contracts are a normal part of the deal; but if you are going to make the majority of musical income playing bars and clubs, you'll be cutting your own throat to take the "no contract no play" approach. I do find the "no contract, no 1099" approach interesting, but again in my experience NO bar/club that I worked without contracts ever sent a 1099 to the band/musicians anyway, so I'm not sure what you gain by that approach.