If you cancel your reservation online, all the points will automatically be returned to your account.

I had to modify one of my pointbreak reservations a few weeks ago, and was able to change the check-in date to 3 days later than originally booked (and got the points returned). When I called to try to shorten another reservation ~1 week afterwards, several customer service reps said they were unable to modify the reservation without losing the rate. It wasn't worth the hassle to argue with them (it was for someone else) so I simply canceled the reservation.

I had another pointbreak reservation at the IC Frankfurt, and I knew I would only need 2 nights instead of the 3 originally booked. Because of my previous experience, I didn't bother calling to try to get the reservation shortened in advance. In any case, the hotel ended up returning the points for the unused nights, which I thought was very generous of them. However, I would also definitely have been okay with paying the extra 5K points for the unused night.

Priority club might very well be clamping down on the flexibility of the Pointbreak reservations. If you aren't able to get your points back for the unused nights, you can view the room as costing say 10K/night instead, and can then decide whether that is worthwhile or not.