What are reliable websites that rate the safety, cleanliness, etc. of hostels in Europe? I have seen that there are a few postings on Tripadvisor which are helpful, but are there any agencies that rate hostels using a standardized method similar to the AAA diamonds?
Look at hostelz.com. I don't think the site itself does the ratings; I think it's compiled from feedback from users (which is probably more valid than someone's opinion from an office, anyway, IMO). As for standardized method, I'm certainly no expert but I doubt the whole idea of hostels comes anywhere near anything standardized!
hostelz.com is pretty good. Check hostelworld.com too.
I just booked three hostels for my upcoming trip to Ireland and I used a combination of Tripadvisor and hostelworld.com to figure out which ones I wanted. For the hostels I was interested in, Tripadvisor had less reviews but what it did have were more thorough, while hostelworld had more reviews but they tended to be one sentence long. So I tried to synthesize what I read about each hostel on each site, and then chose from there.
Hostelling International (HI) does impose certain standards on its member hostels. Their website also includes hostel reviews.