Two distinct flavors: (1) figurative — a hideout where bad people gather (
赌博窝子 'gambling den',
黑窝子 'criminal hideout'); (2) literal angling jargon — a 'spot' chummed with bait so fish congregate (
打窝子 'to chum a spot'). The second meaning is unfamiliar to most learners but very common among Chinese fishing enthusiasts.