I live in Europe so I am used to price that I am paying at the end of the day rather than the pre-tax price. Personally I like this because I know exactly how much I am paying.

From my own experience staying in US hotels, you need to add in around 15-25% tax on top of what you pay. So $359 can easily turn into $400 out of your pocket, plus you don't get points for the taxes you pay.

However you get points for the upgrade since they can't outsource that. Not sure the $75 is taxable - other FTers please advise.

My rule of thumb is $100/10k point, so for $359, I will use the points because you are almost $400 out of your pocket.

I wouldn't try to save up the points because:
1. They do devaluate over time;
2. If you use your money to put into saving account or invest it, you will end up getting interest/earning.