If we want a non-metaphorical (aka literal) interpretation of the Babadook, then we start with the assumption that the monster is real. If the monster is real, it stands to reason that the poem in the book is also real, and accurately telling us the rules by which the monster lives. (They tried to destroy the book several times and it kept coming back, so the book is clearly supernatural itself, and tied to the monster.)
In the last scene of The Babadook when Amelia takes worms downstairs to the babadook: Why is it there? Is it by choice or is it a captive?
"If it's in a word or it's in a book / you can't get rid of the Babadook."
The monster is effectively immortal. You can't get rid of it entirely, once you've let it in.
How did telling it not to harm her son drive it off?
"I'll make a wager, yes / I'll make a bet / The more you deny me / the stronger I'll get"
The Babadook becomes stronger when people deny its existence.
At first, the mother tells Sam the monster isn't real and denies the strange things she sees. This gives the monster power over her and allows it to possess her, doing progressively scarier things.
At the end of the movie, she screams at the Babadook and tells it to leave her son alone. By addressing the monster directly like this, she is implicitly showing that she believes it's real, and so it loses its hold over her and retreats.
To stay safe from the monster, they have to acknowledge that it exists. Feeding it, like a pet, is a way of continuing to acknowledge its existence so that it doesn't come back. (Besides, it killed their dog.) If they ignored it, they might begin to believe it was all some sort of dream or hallucination, which would allow it to return.
As far as "why worms" specifically... why not worms? What do you feed a scary black shadow monster anyway? It was probably Sam's idea.
Note: I do like a lot of the metaphorical answers already given. The movie has a lot of potential in the metaphorical arena. This answer is predicated on the idea that we want a literal explanation of events as they were presented.
answered Nov 16 '16 at 17:02
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