Microsoft no longer uses points and just converts it to the cash equivilent, in this case using http://microsoftpointsconverter.com/
it comes to £6.48, so you're getting extra money which can reduce the price you pay for anything from the live store.
None online, but can be collected at the following stores:
Cardiff - Capital Shopping
Hull - Clough Road
Plymouth - Frairy Retail Park (SP?)
Slough - Slough Retail Park
Stockton - Portrack lane