They get to know who you are :)
That is one catch. But from what I have read here, http://www.vegasmessageboard.com/forums/showthread.php?t=82489
it is pretty legit. I have to warn you, it is a major timesuck though. I unfortunately have no life now, so I've been doing it. Also in the linked thread, certain betting patterns are better for earning "loyalty points" than others. Mainly betting 10X line bet on most games until you reach Level 58. Yes, I said Level 58, and that's where I am at right now. It took over 7 weeks of mindlessly auto-spinning and clicking on bonus games when you get them (I usually play "Lucky Birds", it's one of the easier ones to set and forget). And another tip, try to complete building each property at particular times of day. Once you complete a property a permanent clock begins where you can collect game chips or loyalty points from each property. It goes as follows:
Monte Carlo, Circus Circus, and NYNY: 2 hour window
Mirage, Bellagio, Excalibur: 4 hour window
Luxor, Aria, Mandalay Bay: 6 hour window
MGM Grand: 8 hour window
So one of the more efficient things you can do is complete all the properties that are 6 hours or less around the same time in the day, so you can collect all of these properties every 12 hours, twice! Why twice? Because when a property is "due" you have the same amount of hours to collect the current amount of chips. So if you build the Aria at 8:30PM for example, you can collect chips or loyalty points 4 times a day: 8:30P, 2:30A, 8:30A, 2:30P. So ideally you start playing the game at 8:25P, so you can collect the 2:30P award, and then 5 minutes later, you'll be able to collect the 8:30P award. And of course correlate building the MGM Grand with the time you are most likely to be playing the game along with your other properties, then you'll be able to easily collect that 2X a day as well.
I currently have 97k in loyalty points which means I could stay 2 nights (Sunday-Thursday) in a Mirage suite that is ~1000 sq. ft. for free (full retail value $700+). Recently, they usually offer rooms at discounted loyalty point rates for specific time frames in the next few weeks. So next Vegas trip, I likely book one of those, and then call CET (who I normally stay with thanks to the "Race to Rewards") to adjust my reservation accordingly. The available rewards are limited and are apparently reset at Midnight PST. So if there is something really popular, you need to get it then. The rate of "rewards" you could earn, I might value them at a few bucks an hour if you use them wisely and can keep the game constantly spinning at 10X line bet.