Here's an interesting article on what to do in Kyoto at New Year's:
https://www.insidekyoto.com/new-years-in-kyoto

The more I think about it, the more I feel that the best places for a tourist to be from Dec. 31 to Jan 2 are Kyoto, Nara, or a ski resort. With the Hyatt points, you may find that Kyoto makes sense. As the article on Kyoto points out, you will find that most restaurants are closed from Dec 31 to Jan 2. Many will open from the 3rd, but some of my favorite mom-and-pop places were closed through Jan 5 this year.

The poster above who said that Tokyo won't be "dead" on your first two days, is right, but I swear I saw tumbleweed on Jan 2.