We all have our preferences for how we use the points, so I don't want to say that using them at the Ritz is a bad idea. Because Ritz is a category of hotel that isn't easily Pricelineable, I can understand why you would use points there - even if the raw valuation didn't look so good. If you are long on points, light on cash, and that Ritz offers something truly unique from the other hotels you could consider (like many Ritzes do), then I'd consider the award.

Most of us like to get a little more bang for our points. My favorite big award is the 087 Travel Package. I figure it's worth a little over a penny a point: I value the 120k AA miles at 1.5c each ($1,800) and the 7 nights at a Cat 6 as $1,000. (I used my last one in Kauai.) Some folks might value those 7 nights a bit higher, but don't get carried away: if you are ever in a city where every decent room in every hotel in town is commanding $300/nt and Priceline is unavailable, you will be very lucky to get an award room from Marriott.

On the small-award end, I do a lot of 2-3 night stays in Cat 1 or Cat 2 Towne Place Suites or Residence Inns, hotel categories that are valuable to us and not available from Priceline. I still value these at about a penny a point in most cases...