Everyone has different views about whether the incremental value of a nice hotel or a nice flight is greater.

My own view is that I can get good discounts off the "street rate" for hotels at Priceline, but not air tickets, so I would rather get airline points. Also, for me personally, I can stretch out just as easily in a bed at a Marriot Courtyard as a Ritz Carlton, but the same is not true of Row 33 on an A330 vs. Row 2. The first is a matter of economics, the second a matter of personal preference. (Although ultimately all economics is about personal preference.)

Also, air miles are usually worth more per mile. 25K airline points will get you a coach ticket worth, say, $400. (Yes, with a lot of variation, availability, etc.) 25K hotel points will not get you a $400 hotel room. So if you are getting 1 point per dollar spent, air points will generally be worth more.

I'm not that familiar with SPG, but I believe it has some "sweet spots" for redemptions. Hotel points can often be converted to air points, but not always 1:1.

Completely agree that keeping "rewards" points like Chase and Amex is superior to converting until you need them.