Well quoted San Diego.
I received both an email and a letter in the post from HHonors letting me know about the change and telling me to go online if I want to change it.
Until 31st December 2004 you are allowed to change it as many times as you like so you can for example change it just before a stay/booking to ensure maximum mileage depending on length of stay / expected outlay.
I am not sure what will happen from 1st January. HHounors does not clarify whether after that date, the personal setting will become permanent!
I plan to choose 500 miles per stay just before 31st December to make sure I don't lose out since most my stays are one nighters and my spend is usually somewhat lower than $500. For the odd stay where I will spend more than $500, I will likely have been compensated by getting 500 for short stays.
It comes down to personal patterns in the end.
PS - just to add to San Diego's consolation, I also got bit despite having received notice, but it was only for 25 miles as it was a Hampton Inn I stayed in unexpectedly when I got tired driving through the Carolinas one evening. At Hamptons it's only 100 miles of course!