Maggie.. it has not been my experience that most hotels ask for a non refundable cancellation fee of one whole night,, unles the cancellation is short notice. And, the fee is not taken till you actually cancel, they just keep your CC number on file. That is how every hotel I have ever used has worked so far. The most I have paid for a cancellation was a 5 euro penalty when I cancelled on place a month in advance. Fair enough I thought.
Now, there is available online at some places a special cheap room rate,, only available if you paid entire amount up front , and non refundable. I would never use such an option that far in advance,, perhaps a month or two max. and only for a few days stay, so that if for some reason I had to cancel the loss would not be staggering.
I absolutely do beleive some places that are lucky enough to get promoted in RS guide( and others guide books) do start to take their good fortune for granted. Its free advertizing for a whole year, and many of the places suffer little vacancies because of it, hence a bit of a take it or leave it attitude developes .. NOT all the places, but I am in sure in some of them , this is true.