Very nice. This search works with the way I think. I remember being amazed when Kayak came out and again with Hipmunk. This might be next in that sequence.
On flysaa.com (Star Alliance member) I can get a cheaper direct flight. Not sure what logic was coded to determine which result receives preference (i.e. ranking) in the results.
I also usually use http://flisea.com/ to search for reward flights on Star Alliance airlines. Not sure what API to linking to - perhaps you could check it out.
Or perhaps, change the purpose of the site: Find the best available reward flights on One World, Star ALliance and SkyTeam over a specific period of time. It's focused and a big need for frequent travellers