I have not done that myself, but I have paid for renewing my AP, WDW hotels, restaurant tabs, tours, merchandise and more. I am sure you could pay for an Illuminations Cruise with your points.
When you book the cruise, just ask them!
Just wanted to say, you might not get a great answer then you book. I asked 3 different CM's on the phone if they would take a credit card. No one knew for sure! Of course they do, and I would bet that they take the rewards card as well, but you might want to call the marina and ask instead of the Disney tours booking people.
I paid for our Illuminations Cruise with our rewards dollars as well as a ton of other stuff. The card works just like a cash card and every time you use it they'll give you a balance. When I finished off the remaining balance, I just paid with a CC. It's really easy to use, and they take it everywhere.
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