I've rented cars using miles but only when it made sense in terms of cost. For example, 40K in miles gets you an saver award ticket from HNL to anywhere in the U.S. If a ticket to JFK is around $1000, then using miles is a great bargain so using scarce miles for a rental may not make sense.

But recently you can get a r/t ticket from HNL-JFK for around $500 so depending on the cost of the car, it may make sense to use miles for the car and pay for the ticket which gives you RDMs, EQMs, etc.