I looked at one of these for fun. It was Residence Inn and it came out to about $1,100 for 3 nights, or $366 a night using points and the $599 fee. The hotel website charges about $300 a night + tax.
If taxes are included, it's probably pretty close, but you'd still likely still be paying more to book through RCI.
Now, some people may have a bunch of RCI points and no way to use them. They would be paying about $200 a night. Thus, if you have points to burn, there may be cases where this is useful.
There may be some other deals out there if you hunt enough. Not likely, though.
In the end, like most timeshare things, it is not a good strategy to use timeshare points for anything but exchanging into timeshares.
However, I'm sure it sounds good in a sales pitch.