If you compare the people having issues using their credit card to pay for live vs using it to buy MSP, you'll notice the latter is the larger group. Also, there are people who can't buy MSP who claim they can pay for live just fine, but not the reverse.
The computer that runs live subscriptions is programmed to "wave you through", so long as your credit card clears. It won't care that the US account is using a card that belongs to a bank in Nigeria and the IP address is in China - if the card doesn't decline, WELCOME TO LIVE GOLD!
On the other hand, the computer that runs Microsoft points is set on "paranoid mode" (TM). Your credit card says John C. Smith but your live account says John Smith? REJECT! Your IP address changed twice in the same year? REJECT! Your live address says "123 fake st" but your card says "123 fak st"? REJECT!
The above are exaggerations, but you get the point. Now, it is possible to try and get around Mr. Paranoid by setting their account out of region and buying cards for that region from the Internet. However, sometimes Mr. Paranoid catches them on the flip side by blocking them when they make their purchase or by stopping the download or even corrupting the file. These are all over the forums and it seldom comes down to anything other than "non-supported region".
However, if you tried to buy a gold subscription with those points, the gold subscribe machine would wave them through at once - and Mr. Paranoid can't allow that. So, it simply won't take them at all. Now why Microsoft set it up this way is a another question entirely... but that's how it is.