I pretty much come down on Hilton's side here, too. Like Premex, I remember $19.85 flights DCA-LGA and $29 flights EWR-SFO. That is not unreasonable. A $0 flight is just silly.
And as for calling 300 nights excessive, well, IMHO, it is either right or it is wrong.
I, too, am interested as to the content of the email. Was it telling you about the $0 deal and telling you to book one, or was it from someone complaining that they were told hilton would not honor their $0 rate? In other words, what does the email you got have to do with this issue? Was it from 'the list' that was so widely jumped upon a few months ago???
My curiosity is piqued!!!