From what I understand (Which is not much) Unreal has always worked with best LAN or networked games where one of the Players hosts the game.
If you look at the Tom Looman Survival Game … you either HOST or Join a game
In the cowboy shooter game which for a time worked over steam its the same thing… one is hosting the other is joining its just that the information is shared with steam… i dont believe they have any other role
I would imagine that a dedicated server is better so far as “Cheating or Manipulating” is concerned. I would also imagine it is extremely complicated and problematic to set up!
For simplicity and if its not needed I would say client hosted games is the best solution.
Im sure someone who understands this better will tell you more and correct me!