SilverWook said:

One could argue he must have had a natural source of water nearby. (The sandpeople must have wells.) A vaporator and smoke coming out of the chimney is way too much advertising for a Jedi supposedly in hiding.

If he wanted to literally hide, he would go on a jungle planet where he could live in a bush.

However on Tatooine he had to became an average nobody. And an average nobody on Tatooine usually farm moisture. A perfect way to blend in and not cause suspicion. He could try to avoid civilisation for the most part but at some point he had to go to local shop and buy grocery. Living like a caveman would cause far more suspicion than being like the rest of the farmers.