On one hand, they're nice in that the exact value of your "points" is known and guaranteed.
On the other hand, the conversion often isn't that great, typically 1-3%. Meanwhile, earning rewards in "points" or "miles" can return value in the 5-10% range if you're savvy enough. The savings can be worth it, but some might just use a cash card out of principle (refusing to allow the card issuer to dictate how points are used) or laziness (Just don't feel like optimizing the return).
You can get more if you are willing to deal with the points. For example, Chase will give you 3 points per dollar on some cards on some categories, and Amex will give you 4. Those points can be >$0.01 each transferring to airline miles (or in the case of Chase $0.015 "paying yourself back" for restaurants). No card will give you 4.5% cash back on restaurants.
That "3 points per $" on Chase cards also translated to credit statements when 2020 happened. It was an effective cash back at the same valuation of the points if used on travel through thr travel portal.
Regularly converting some credit card points is a good idea if you need the cash and it's a terrible system when they don't let you convert for cash. I consider any card that doesn't value points at 1:1 cent as junk.
But if you can use them within the system it's almost always a better deal. When used for airlines there's a large percentage increase in their value when buying tickets. When booking a hotel the cash price can sometimes be twice as much as the points price when I transfer credit card points in for example. Chase offers pay yourself back which increases their value on purchases in certain categories, although the categories haven't been all that great lately.
I used to convert nearly all my points to cash immediately but now I sit on enough for a small vacation before considering changing them out.
Definitely a more flexible option, but you might trade overall value for that flexibility (in the sense that you can frequently use accrued points for more value than the cash).
Or you might not, if the only choices are to buy stuff from their shitty Company Store, or convert to airline miles. I don’t need more stuff, and we don’t fly much. There seems to often be an option to convert to cash, but that’s usually a penalty choice. So we dumped the points card(s), and mostly use the Apple Card, which is just straight X% cash.
Regardless, if I’m going to play “maximize value of effort expended”, I’ll fire up the Xbox and play an RPG. I’ll get a lot more pleasure out of that than playing with credit cards. OTOH, plenty of folks might consider Octopath Traveller a waste of time, so to each their own.
On the other hand, the conversion often isn't that great, typically 1-3%. Meanwhile, earning rewards in "points" or "miles" can return value in the 5-10% range if you're savvy enough. The savings can be worth it, but some might just use a cash card out of principle (refusing to allow the card issuer to dictate how points are used) or laziness (Just don't feel like optimizing the return).
For me, I use a cash card out of laziness.