I have read multiple accounts of poor terminal performance with the .308 168gr match ammo, yet almost every site I go to cites it as THE preferred sniper round in .308. If terminal performance is so bad, why is it the most used .308 sniper round? I know it is supposed to be the most accurate, but if it disintegrates on impact, whats the point? Please educate me, the more I read, the more confused I get.

Where are you reading this?  A 308 has poor terminal preformance?  Yea right.  Most snipers will use this round as it is accurate, hence they have more of a chance of making a CNS, putting the bad guy down for good like yesterday.

The bullet performs erratically once it hits its target--now, obviously, it does a GREAT job of hitting the target.  

Some of the bullets drill right through without fragmenting or even yawing much...basically, a sub-30 caliber hole drilled through and through.  Other bullets yaw quickly enough that they fragment, which causes a massive wound.

It shouldn't surprise you that many police snipers still use this round--they dream of the perfect 500 yard shot, however likely that is, and don't bother to research the terminal effectiveness of the bullet.

Many have gone to using Ballistic Tips, because they're reliable for expanding/fragmenting and designed to be plenty accurate at typical sniper distances.  Even better are Hornady's A-MAX bullets.  The 155 grain is favored due to its consistent perfromance in gel testing.

Snipers are trained to place shots in certain areas...i.e. a rectangle from the corner of one eye to the corner of the other.  The BTHP is extremely accurate and can be counted on to go where the sniper wants them to.  Frag or not a head shot will kill...it's all about shot placement.

For a center mass type shot, the 155 AMAX is much better due to the fragmentation of the bullet.  If the BTHP doesn't hit anything hard, it will most likely act like a FMJ round.

FWIW - The 168 BTHP is basically a non-functioning hollow pont.  It is not like a pistol hollow-point that is big enough to aid in expansion.  IIRC the hollow-point on this particular round moves the center of gravity towards the rear of the bullet to help stabilize it and thus make it more accurate.