We were at the Dolphin Feb.16-24, 2003 and I was charging like mad in the few months before our trip to accumulate enough points for an upgrade. When I called SPG in Jan. they told me about the 5 days before check-in and when I called 5 days before they said there were no upgrades available. The person at SPG could tell I was not happy to hear this and said not to be disappointed that an upgrade may still be possible at check-in. By now I had given up hope, we wouldn't be arriving at the Dolphin until around 6:00pm on President's Day weekend.
At check-in we had a really nice desk clerk named Jason. When I showed my SPG card and a big smile and asked about a free upgrade, he showed me a binder with maps of every room in the hotel and pointed out which ones were available. We could have had Club Level on the 12th floor but we took the balcony room instead. And didn't have to use any points.
The moral of the story in this case is: Don't even mention the points until your all out of options. There's also something called "Instant rewards" where you can apply points towards things like meals, massages,etc. but I forgot to ask about this cause I was so excited about the free room upgrade!
Sorry this is so long, but I hope it helps...
I know you will have a wonderful time at the Dolphin.