I have both the Diners Club and the Sheraton Optima. I think that it is more important that Starwood does not devalue the Sheraton Optima card (than the inclusion/non inclusion of Diners Club in the new Starwood program).
Personally, I have never used the Diners Club for hotel transfers, but have used my Diners points for the double mile promotion with BA. That way $5000 charged which is normally 5000 miles, gets you 10,000 BA miles which can be used for a free night with Marriott and some other BA hotel partners.