Great analysis. One thing that could be added though is the opportunity cost of a cash back card. 1% is pretty much the base standard. The Costco Amex offers 2% on travel and 3% on dining out in addition to 1% on all other purchases.
Contrived example:
If you spent $3000 monthly for 16 month on a mix of 1500 travel/400 food/1100 other, you will end up with $848 in cash or 48000 Starpoints. Retail for 5 days in Hawaii is about $300/night placing the value of 48000 Starpoints at $1500. With just minimal research this price can easily drop to $1050 (by 30%). Starwood wins but IMO by a relatively thin margin taking into consideration that you lose the flexibility of cash and will not earn points on the otherwise paid stay. If this strategy is fine tuned by using other cards to make better use of the $1100 other spending such as grocery and gas station 5% cash cards, the call is even closer.
Anyway, this was mostly to illustrate that using reward cards comes at cost much higher than just the annual fee.