I have taken advantage of this guarantee once and it went very smoothly. Granted, it was just a one night stay. All I did was tell the agent when checking out that I had had a bad experience checking in (checked in at 11 pm, had to wait in lobby for 2 hours while they searched for an empty room and woke up many in occupoed rooms during the search).
My point is that I had no problem getting the charge for the night erased.