From the perspective of resto druid actually makes perfect sense.
What you said is that the small tick Ysera's gift provides does not save lives, so it's not useful right?
Rejuv tick is not a lot stronger, so it must not save life right?
What hots do is to help relieving healing pressure. A hot tick will not safe life most of the time. But they are not useless.
The benefit of CW is so tiny and it costs a gcd as well as mana. Most of the time you would rather just rejuv the target.(And again would you say rejuv is not the talnet choice?)
If CW is not saving the target from death it's just plain useless as rejuv will just do the job better.
And how many times that you know someone will be dead beforehand and cast a CW to him to prevend him from dying?
And for renewal it surely can be useful but it depends on how the encounter goes. I have soulstone and find that when the raid wiped I was often the last man standing without consuming a single use of soulstone.