Just a single data point, and I’m not sure how representative this is. I was/am holding two rooms booked with a combination of points and FNCs for early March. I was hoping for a third room (and had 2 additional nights already booked—this was before a 3-day min was required). My goal was to get a total of 3 rooms for the same dates. While on the phone with Hilton “Diamond Desk,” I was mistakenly informed that she (the agent) could see multiple standard award night rooms available (5) for another week in March. I was skeptical, but a second agent confirmed the availability before I gave the OK to start cancelling my existing reservations and booking new dates for the following week. Sure enough, just as soon as the first new room was booked, the agent said “OMG, I’ve never seen this before! The other award rooms have just disappeared!” To your point, the original room that I had just cancelled did go back into inventory and I was able to grab it back. But I ended up with two rooms one week and one room the following week (which I will have to cancel at some point). Did not get the third room I was hoping for. Making matters worse, my FNCs that expire first ended up on the reservation I will end up cancelling.

Remember, this is a single data point. I’d say it’s likely that your cancelled reservation would go back into inventory, but there’s a non-zero chance it does not, and if there are delays in the crediting back of points from the cancelled reservation, you could end up short of points even if using one or more FNCs on your new booking. If you have ample additional points, this isn’t an issue, but given my recent experience, I would seriously weigh how disappointed you might feel if your existing reservation were to blow up versus the incremental benefit of subbing in an FNC and freeing up 130,000 points.