I just booked 4 nights in Maui at a Starwood property using Citi Prestige 4th night free. Was on hold for 5 minutes when I called, then it took about 15 minutes after the guy came on the line. I have no frame of reference since this is the first time using the 4th night free, so I can't tell you if it is much better than before, but this was pretty painless. One thing he pointed out was that the rates would either come from their system or from the hotel's website. And you can still use the AAA discount or other discounts from the hotel's website.
Rooms were $440/night including all taxes and fees. Total $1,760 less $440 credit, net $1,320.
Kayak had special rates only available via Kayak. It was $370/night, total $1,480.
So I only really saved $160. It's still awesome.
I'm actually staying 6 nights in Maui, but the other 2 nights are covered by SPG points, so that's that.
But yeah, it'd be nice if these could be self service via a website.