I got the deal too. Its legit and I think I will do it. I used to be Diamond and just came back through a successful trial so that may have been the trigger to keep me as I may not requal next year. They know I have the competitor travel spend since I had to show competitor top tier to get the diamond trial.

Andrea: your benefit you pasted says Plat status.

I confirmed even the footnote restates this is Diamond in my offer. I will certainly save the email if they ever try to go back on it.

Update: Ok, I bit and signed up. No repeat of these terms in the application process, just the basic card benefits (no mention of the 2 free night sign up offer either).

I made sure I used the link to their web page version of the email and saved down an mht file of the site for future evidence.

I don't think this is a big problem:
1) It seems to be highly targeted, not just anyone can get this.
2) The only people who are going to be using the diamond benefits are those staying at a Hyatt. If they are not staying enough to gain Diamond status then they are not hogging up the lounge or other bennies.

This is not anything like the airline credit cards that are giving away elite status to ANYONE.

HUGE Kudos to LoyaltyLobby for posting this. It made me go back and check my offers that I have come to ignore!