The fuck. That's ridiculous, on both parts.
Enough money for petrol and a bottle of water not good enough for them? Jesus.
You must not have been touring/playing shows regularly or for a number of years. Otherwise you'd never say that.
Also: once you realise the amount of money that organizers can make even off of smaller bands you will see why bands want to be compensated like that. Also, if you have been on tour for 2 weeks, let alone 2 months or half a year, you will want to have any possible luxury. Especially if you are making the promoter a shitload of money.
Little example:
500 ppl show up to your gig at $15 per ticket = $7500
minus club costs of 1000$ (they get to keep the bar income) = $6500
minus costs of promotion (posters etc.) at max $300 = $6200
minus bandfee at that level of $2000 = $4200
minus 4 hotelrooms at $400 = $3800
minus catering at $100 = $3600
minus additional random expenses of $200 = $3500
Take off 50% tax (here in Germany, less everywhere else in the world) then you end up with $1750 for a what is essentially nothing more than a few phonecalls, emails, webpostings and a 10h workday on the day of the event, if you got your shit sorted.
Now multiply the income by 20 for a Pantera show with a 99% guarantee of a full venue ... I'd let them fuck my daughter (if I had one) for that money, too
People in the metal business have been taught forever that there is no money to be made while in reality EVERYONE is making good money except for the bands. Why do you think people keep doing it for their 25th year?
And as the owner of my former label used to say: "If I had started a metal label in 1994, I'd be well off now!" ...