No discount if paying with a gift voucher?

Our family was given 3x $50 gift cards to a local restaurant at Xmas by my parents.

Tonight, we went to use the cards, and after ordering food, we were told it's Tuesday, so kids' meals were free. Total bill $126.

When we went to use the gift cards, we were told the kids eat free could not be applied, and we could only use one gift card at a time when dining.

There was no mention of this limitation on the cards or in the little folder they came in.

I mentioned to the manager that if I paid with a Prezzy card, would i get the discount.... yes...... so why are gift cards treated any differently? He just said it's the restaurant policy.

After some back and forth, we got them to break the meals and drinks down so we could use the 3 cards on 3 separate invoices, but no discount and a total of $158

Is this a common thing in restaurants?

I don't understand why the gift cards were not treated as cash? The cards were purchased at full price, not discounted.