If you had booked through the hotel directly, the same would have happened (if their cancellation policy were also 24 hours). While it's possible for a hotel to waive the charge if you had booked through them, that doesn't mean everyone else has to waive the charge. The rule for your rate was one night penalty if cancelling less than 24 hours out. Why does that make them "suck"?

It has nothing to do with room availability for the two nights you are adding five days later, and it has nothing to do with the total number of nights being unchanged. The issue is that you reserved a room for tonight and now do not wish to use it. Hotels have cancellation policies so that they aren't left with a bunch of empty rooms that people had reserved and then cancelled too late for the hotel to reserve for someone else (similar to airline tickets).