I've thought about both sides of the proverbial coin - staying at hosts' places and hosting myself, but the position the OP is in is what turns me off for the most part - more so on hosting myself, but partially looking for a place to stay (in the perspective of being a stranger in a host's home).
One of the best parts of riding, for me, is the people I meet on my rides, though. I've had some interesting conversations with other riders, and non-riders of all ages. From a touring perspective and potentially a place to stay I'd rather one of those local encounters with people turn in to an opportunity to couch-surf, shower, or camp in a yard. There is a saying that "you don't get a second chance at a first impression" - when you meet people in person from the start its a lot more personable of an interaction than a "reservation".
I understand the community aspect of riding, and I'll even throw out there backpacking. Those of us that travel by our own power tend to respect others that are equally traveling by their own power. So lending a hand to riders (and/or backpackers) is natural for a lot of us. The unfortunate thing, though, is not everyone in this world is as like-minded and there are some that will use, abuse, and take advantage of. However small of a percentage as that is it still sucks the energy out of catering to the crowds we want to cater to.
Just a thought - the guy that had the felony in college might have just royally screwed up back then. That shouldn't be a life-sentence for him. Perhaps it was a lesson. How do you know he didn't hit hard times out of that experience and has found new freedom, life, and energy in cycling? There's probably a lot of us that can relate to that, in some capacity. How many things have people done that don't get reported? Just because you pass judgement on a documented record doesn't mean there aren't worse-behaved people out there that would go under your radar. I don't say that to stir any pots, just being practical. It just may not be a fair shake to pass judgement on someone from a past record/experience. There could be a lot more to that story, and maybe a more recent timeline, that could speak to more of the judgement that was passed and you certainly are entitled to make a decision in some fashion.