I did this today and called CS to ask what to to. They told me and this is what I did: 1) I booked on the website via points for my kid and parents. 2) I then called Marriott CS to add their names to the reservation and to say it was a gifted night. CS then manually changed the reservation to a gifted night one.

On my account on app, the reservation still shows up but under guest name, it shows my family now.

They do not get my titanium benefits. It was a very easy process - surprising because .y app doesn't work often. All told, it took me 3 mins to book on all, call CS and have them change everything