Actually it's 30% off best flex not 50%.
What the hotel is looking at is not the rate you paid, but the rate paid to them by the travel agency.
For example, Travelocity offers a lot of pre-pays at IHG hotels. While you may pay Travelocity $100 per night, the hotel may only get $75. So this is a negotiated contract and not eligible for points.
For instance, here is the fine print when you book a pre-pay through Travelocity:

All GoodBuy hotel reservations are prepaid. Your credit card will be charged when you complete your reservation.
The total charge includes all taxes and fees
GoodBuy reservations are guaranteed for late arrival
GoodBuy reservations are generally ineligible for hotel award points or airline mileage

Also, if the room is being paid for by a third party, the hotel does not have to issue points. A lot of times this is rooms paid by a direct bill.