First Night: Reading Festival, Berkshire

"We're punctual at least, right?" Arcade Fire's Win Butler smiles, near the start of his band's triumphant Saturday set. He's referring to Guns N' Roses' Friday night fiasco, when Axl Rose lost his grip on rock as an art or profession in an hour-late headlining set that is already a byword for career immolation. By contrast, Arcade Fire strive to reach fans with their complex, less familiar music, till the moment they're anointed as a major band.

Reading lost its way last year. This weekend saw one band's definitive fall, and another's steady rise, as well as the reunion of Pete Doherty and Carl Barat's Libertines. Something was at stake every time. Arcade Fire play much of their recent No. 1 album The Suburbs, meaning the set is heavy with nostalgia for the 1970s-built Montreal suburban landscapes Butler grew up in. Songs such as "Modern Man" and "Rococo" depict a sickened reaction to the modern world. But Butler is a novelistic, not angst-ridden writer. The fear in Arcade Fire's songs is transcended by the drive and fierce joy of this seven-piece band's stage-filling sound.

The last time The Libertines played here, Pete Doherty had been expelled, after burgling Carl Barat's flat. Such seedy behaviour seems in the past. The self-lacerating psychodramas of songs such as "Whatever Happened to the Likely Lads" and "Can't Stand Me Now" have their meaning reversed here, as Barat frequently hugs Doherty. The ambiguity of lines such as "Can't take you anywhere... I would take you anywhere" tip towards brotherhood not break-up. A raw blast of Doherty's harmonica as darkness falls sparks a sea of waving arms. When Barat kisses Doherty on the lips, Doherty angrily tears away, ripping his shirt open. But detente, and the idealism and wit of The Libertines' early years, is restored by the end.

Reading also happily restored its hard rock credentials this year. Queens of the Stone Age's stoner psychedelia was a little too sluggish on Friday, but Blink 182 were due to headline a Sunday of dedicated, diverse head-banging. Touring the site, and stumbling over trusting encampments of young people sitting in the pitch dark, I found Berlin's Atari Teenage Riot ranting over a rhythm section like a pneumatic drill, next to Enter Shikari's muscular emo.

Earlier, Springsteen favourites The Gaslight Anthem play elegant, compact rock, as singer Brian Fallon howls his self-conscious poetry with husky commitment. The crowd stay unmoved, his mythic New Jersey more than an ocean away. Fellow East Coasters The Walkmen are more tightly wound and tuneful, while Modest Mouse's Americana stays dourly workmanlike, missing Reading's point as much as Axl. UK indie survivors The Futureheads and The Mystery Jets get warmer welcomes.

Dizzee Rascal, a teenage Nirvana fan back on his Bow estate, brings a rock band complete with hairy guitarist, another artful, ultra-commercial pop curve from this formerly furious artist. Fans sway on the spot, wannabe grime kids dancing like 1960s ravers to their favourite family entertainer; pop at its transformative best. Nearby, Villagers' Conor O'Brien fills a tent with his Mercury-nominated poetic torrents. "How they change," someone sniffs. Too nakedly calculating for someone so fresh-faced, his songs can't be denied.

Only Axl Rose will be remembered in future years, like a slowly fading scar. Truly great music was, as usual, hard to find. But Reading refound its form, with a sometimes daring cross-section of rock in 2010.