That is utterly ridiculous, and they should be sued over it, imo.
I would use it in my advertising. “Here at Motel 6 we hope you have a pleasant stay. To help with that - we fax all registrations to police within five minutes.”
Although that sort of thing should be stated up front. And then you can decide if you want to stay there or go to the Holiday Inn instead.
I agree. Sue them.