Booking.com now powers the regular hotel booking portion of the Southwest website, and yes, it's pretty abysmal. But you can't use points to book there, you need to go through More Rewards to do that.

I'm not sure powers the hotel portion of the More Rewards, but it's also pretty much a disaster. If you are able to get past the multiple circular and sometimes dead links, the prices quoted are often way above even rack rate. Unless you have tons of points to use up and don;t care about the redemption value, it's really not worth it.