If you havent booked anywhere yet you may struggle and camping maybe your only option. Some hotels get booked up years in advance by regulars and the F1 Crew in places like the Dorint and Lindner.
I camped last year at Mullenbach which I found to be the best place offering shower and toilet facilities on site but make sure to find a space situated close to them otherwise it can be a pain getting to and from.
Turning up on the day and paying for a spot is fine but expect to a small and less desired place.
The locals turn up up to a week before to reserve their usual spaces and seem to take over the campsite with no rules as such as to how much space they can take, barricading their area with a wall of cars etc...
Mullenbach Campsite map here. Situated at the tail of the GP circuit.
http://www.ukcampsite.co.uk/sites/de...asp?revid=7891
Camping is dead cheap and if there is a group of you it can be great, and if the weather is good to you it'll be a bonus.
They offer electricity on site too for a few Euros a day which is great but take your own extension lead, as long as you have (25-50m if you are not close to the power).
Also a few examples of what to expect from some of Ze more serious Germans:
http://79.99.67.179/forum/showthread.php?t=215236
Tickets for the weekend can also be brought on the day no problem.
If you want to get around various viewing points of the track there is a bus that collects every half and hour or hour right outside the camp site.
I hope that helped a little.