mspman,

You're basically right as I see it, but I would point out that one already books AF-coded flights just like an SQ award. The thing being eliminated is being able to book Delta awards using Delta seats on flights operated by AF; those award seat inventories will cease to exit.

I think this must have something to do with the anti-trust deal, since now all the seats will come out of some real time pool rather than strict blocks. It probably makes sense to attribute costs/revenues/expenses for award tickets to the operating carrier.