ok, a fresh install of debian 7.6, here is my settings, I don't have
libnss-myhostname installed yet
root@test1:~# cat /etc/hosts
127.0.0.1 localhost
# The following lines are desirable for IPv6 capable hosts
::1 localhost ip6-localhost ip6-loopback
ff02::1 ip6-allnodes
ff02::2 ip6-allrouters
root@test1:~# getent hosts $(hostname)
root@test1:~# cat /etc/nsswitch.conf
# /etc/nsswitch.conf
#
# Example configuration of GNU Name Service Switch functionality.
# If you have the `glibc-doc-reference' and `info' packages installed, try:
# `info libc "Name Service Switch"' for information about this file.
passwd: compat
group: compat
shadow: compat
hosts: files dns
networks: files
protocols: db files
services: db files
ethers: db files
rpc: db files
netgroup: nis
root@test1:~# host -v $(hostname)
Trying "test1"
Host test1 not found: 3(NXDOMAIN)
Received 98 bytes from 8.8.8.8#53 in 14 ms
Clearly, it skips /etc/hosts entries.
After digging around, I noticed, that I had always setup DNS records for my hosts prior to doing the installations, which caused me the confusion on what was happening. I thought that the looking up my hostname resolves correctly by getting the ip from /etc/hosts, which I was wrong.
So yes, host does not look in /etc/hosts by default.