Sounds super complicated. I had thought about buying a distressed timeshare to also trade into dvc, as well. I own points at two dvc resorts which I'm very happy with but always looking for excuses to head down there. Not sure if I have the wherewithal to understand, let alone master, the Rci-dvc trade.
Timeshares generally are complicated. Think about the learning curve with DVC -- 11/7 booking windows, dues, UY, which resort to buy, direct vs. resale, banking, borrowing, use of DVC points for other options, etc, etc, etc. Points systems may make it easier to get your head around, but it's ALL complicated. RCI exchanges, either into or out of DVC, are just one more system to learn.
Plus, at the end of the day, do you truly save money on that trade/exchange? It's $109 plus weeks of your timeshare (so a few years worth of maintenance fees), so would it end up being even Steven without the hassle?
Like virtually all financial comparisons, the answer to this is, "It depends." It depends on what you are trading, how much that costs, what the various fees are, etc.
But when you see someone as knowledgeable as Dean, who owns both DVC and several other timeshares, exchanging into DVC repeatedly, it obviously makes sense for him.
Personally, I have only exchanged into DVC once, but it made financial sense for me. I exchanged in using Wyndham/RCI for an OKW 2 BR December 14-21, 2013. My costs were the prorated acquisition costs of my Wyndham points (almost zero because I bought Wyndham on eBay for next to nothing), my maintenance fees for those points, the RCI exchange fee ($199 at that time), and the DVC incoming "because we can" fee of $95. My total costs for the week were about
$860. My total cost (including both acquisition costs and MFs) if I had used OKW resale points for the same stay would have been about
$1,625 (232 points X $7).
So, in that particular situation -- for my family, considering my exchange property costs and all fees -- the exchange cost a little more than
half what the same stay would have cost using DVC points.
And...I should also note that I got a TWO bedroom during what we usually consider the most difficult time of the year to book.
For our next WDW trip, however, I probably will not exchange into DVC -- not because of relative cost, but because of the accommodations I will want. I will probably use my Wyndham points for a 3 BR at Reunion for our family and DD's BFF family.