Prior to the latest T&C updates, I have had semi-flexible third party rates approved compared with the IHG Best Flexible rates.
I agree that in accordance with the terms, this should not have been the case, and I personally would have declined the claim were I the handling agent, however, I believe there was discussion even on here which suggests my experiences weren't totally out of the ordinary.
Advance Purchase rates are really the only rates that can be assured of getting approved.