"Does anyone else feel this is unethical?"
Well on the surface yes. And probably yes. But read on.
"You are basically paying someone to circumvent the controls the price structure the employer has in place."
(Now I'm for the defense here and will argue the other side of this).
Well let's look at it from the employers point of view.
- They want to keep employees happy. So as long as this doesn't happen to much they will probably look the other way. (Cheaper than raising wages).
- They want to keep guests, especially desirable "clued in" guests happy. After all this guest now feels as if they got away with something and got a boost in their mental state (source: attitude of the OP)
- God knows if Jack Nicholson walks into your hotel and your front desks comps him for internet (just because he smiles and says "hi" in a nice way) the employee will feel good and the employer will probably feel it is ok as well. (They very well might have a policy for this special treatment of course but don't for tipping simply because they can't openly say that it would create all sorts of havoc).
I once had an employee many years ago who told me he was going to help his wife with her business on my time a small bit. (In so many words, he didn't say exactly that). I was ok with it because I figured he was going to do it anyway and I might as well suck it up.
Besides, and most importantly, if his wife's business made money he wouldn't be as quick to want a raise from me. If I told him "absolutely not, no personal business on my time" he would, in theory, be more likely to need to get a raise since his wife's business wouldn't contribute to the family income. All the details of this matter of course (no hard and fast rule) but over time the situation that I had allowed worked to my advantage.