I'm no expert on this, but I can let you know what I do...

I convert my FPPs straight to cash, but only when I hit Platinum star every now and then for maximum conversion (I'm usually Gold). If you're an mtt player then using the points for mtt tickets is a good idea as the conversion rate is marginally better unless you are Supernova. For me, the extra little bit of conversion rate for the mtts isn't worth it for the amount of time it would take to convert at a modest ROI (in comparison to playing cash games instead), but obviously the odd time I do play mtts at the weekend, I'll use FPPs to do so.

That said, there are some very good value FPP satellite tickets available as long as you are competent at mtts. There are some up-to-date threads on 2p2 and other forums on the issue that you should be able to find using Google. If irc, the 235FPP satellite tickets that can be converted to $$ seem to be perceived to be the best use of FPPs.