Agree that it's disappointing to see the wholesale devaluation of the cash and points program since hotels have kept up with inflation by changing category yearly anyhow. I guess I never really noticed it before, but cash and points was pegged at 40% of the full point redemption plus the cash component. Now it's at 50% and therefore it seems like Starwood is saying that the cash component is exactly what the points are worth (maybe what they are giving the hotel (but obviously that's proprietary)).
So for example, a category 4 is now 5000 points (half of the full redemption) plus $75. So 5000 points are worth $75. That's 1.5 cents per point. Which means that the average room rate should be around $150 plus the value of the points you'd earn. So maybe $160-170. Sounds right for low demand times in many places (and since these area capacity controlled awards, low demand times seems fair as a comparison).
I picked a random weekend in June for some "research." in Canada, of the 13 category four hotels, 1/4 are around $150-160. Those all have cash and points available (even at the old rate). Many of the hotels coming in at around $200 (1/3) also have cash and points available. The hotels that don't offer cash and points are the ones with higher rates--above $250 (1/3 of hotels) [and, surprisingly, the one with the lowest rate]. Tried Germany (15 category 4 hotels). Most have cash and points available and most are around 100-135 Euros. The ones that are above 200 Euros don't have cash and point available (along with some of the lower priced hotels). Very limited data but basically if it seems like if the cost is high, then no cash and points. If it's around the value SPG seems to be assigning, then your chances are good. Did a few more and the main anomaly was Texas. Of their eight category 4 hotels, ALL were available with C&P and though most were around $160-170, three were up over $200 and even the one over $300 was still showing C&P.
As others have said, if this adds to availability it's good, as is the possibility of redeeming cash and points for nicer rooms. But it means that I will have to check for values much more carefully than before and I may give up the SPG Amex card if I find C&P is just not the value it was once, since for me C&P was the sweet spot of the whole SPG program.