I am wondering about kids' fee for reward reservation as well. $525 for 7 nights for a 7 year old seems too much.
On the other hand, it looks like if I change the reservation from 2 adults + 2 kids (1 under 6) to 3 adults and 1 kid - it increases the price by only 20,000 point, or I can even go from Ocean View 2+2 to partial ocean view 3+1 for 10,000 extra points and hope for an upgrade (being Plat). Maybe that's the way to go, after all.