Got a response from the agent. What he told me they do is divide the total cost of the stay by the number of nights. That is the average rate per night. They then use that to compare each night. If the night is lower than the avg, they don't change it, if it is higher they match the price and then deduct 25%. Interesting way to do it. For my case the avg. price was higher for 2 nights and lower for 3 (which they matched and gave me 25% off). But, if I had made two separate reservations, I would have gotten 25% off all 5 nights, since all the nights were lower in the matched rate.

In the future I'll just make multiple reservations to maximize my savings. Still happy about the claim as it was a savings of ~$500 though could have been more.