I agree that it can be quite difficult to generate significant cash savings from redeeming these points, for the reasons you mention, and I too have chosen to pay cash, on occasion, rather than 'waste' the points. However, between IOM and LGW, for example, you can save up to £58 on a round trip for 16 points, once the higher cash fares have kicked in on the booking engine.
In my experience, the way to obtain the optimum value from 'Rewards 4 All' is to redeem 11 points per sector and book Economy Plus. That way, you get the cash saving difference the basic fare, plus a free bag each way, lounge access and inflight catering. That adds up to a possible benefit of around £90 on the example above. That makes each point worth c£4.
Obviously this only works if you need to take bags and have time to use the lounges.
Bearing in mind that it is a very simple scheme, once you have set it up, I consider it worthwhile and I do get some value from it, from time to time.