1) Technically not allowed, but MAY slip under the radar.
2) Technically they should not get any of your benefits if you are not present, but again, MAY slip under the radar.
3) Using your points probably increases the chances that this would slip under the radar.

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4) There is a risk also that if the reservation is listed under your name, and you are not present, that they will not let your relative check in at all, and will mark you as a no-show, billing you for the stay at whatever penalty rate. If you gift like OB one suggested, that risk is eliminated.