Hydration Cells are cells full of highly refined water, made from placing a Water Cell into an Extractor to make a Coolant Cell, and then again to make it into a Hydration Cell. Simply right-clicking the cell onto some IC crops will consume some of the water and hydrate the plant for a period of time. The cells can also be inserted into a Crop-Matron for automatic usage. Two partial Hydration Cells can be crafted together into a single cell with the combined amount of usage left.
Hydration Cells, along with Fertilizer, add to a hidden Nutrition value in the Crop. When a Seed Bag refuses to plant, or a plant disappears, it is usually because the Crop's Nutrition value falls too low to support the plant. As a plant's stats increase, so do the Nutrition requirements for that plant. In the case of not planting, another factor could simply be improper light level.
Hydration Cells are not a replacement for water, but a supplement. Also, Nutrition value only plays a part if the crop has not yet reached its final growth stage.