Update: It worked.

Upon helping my friend make the initial reservation, I had checked the box "use gold rewards points." A drop-down box offered redemption options, but when we clicked through, no points were redeemed and price was not reduced based on points used.

Today, using the Modify Reservations feature, we again checked the box to use points, again used the drop-down to redeem one day, and this time got the expected price reduction associated with one day redemption.

Not sure if this two-step workflow (create, modify) is required, or if something just went wrong the first time. Anyway it now seems to be in order. Hope it's helpful to someone else.