> "This idiocy encroaches on property rights."

Notably, the property rights of the hotel patrons who bring their legally owned property on their person into the hotel and find that the hotel has surrepetitiously disabled it against their wishes for the purpose of creating a local monopoly on a service (internet access) which they have no right whatsoever to regulate or control.

So yes, it does encroach on property rights. Just not in the way you seem to think.