Pay to play is when a band gives a promoter or booking agent or venue or headliner or anyone – money, to play an event. Or they are paid in tickets which they must sell. Pay to play in my opinion is an unhealthy experience for all involved.
A booking based on draw is different – fee’s typically fluctuate with the bands draw (the number of people who are likely to attend based on history, similar bands, fit for venue, demographic or whatever information is relevant) at most, but not all venues.
In the old days radio play, promotional tools and label support also factored in. Some smaller venues (like college pubs or wineries, or some eateries) have an audience no matter what and can book more speculatively. They typically (but not always) pay on the low side as they don’t need the band to draw.
Its an industry of relationships. Bookers and owners and operational methodologies often change while the name of the venue does not. I think the best idea f or figuring out how a venue functions is to look where similar bands play and ask those bands about their experience.