Hi Lisa, Did you have to return the vehicle to Punta Arenas?
I too plan to rent a vehicle and go as far as Chalten. I'd hate to have to double all the way back, if possible. Any suggestions?
Is a 4WD vehicle neccessary for TdP and Fitzroy?
I don't know of any feasible way to avoid doubling back to Punta Arenas. You can drive yourself or take a bus, your choice, but you'll be spending hours in a wheeled vehicle either way. (Note that I'm no expert - I've just been there once, and things might conceivably have changed in the meantime.)
The border crossings between Chile & Argentina weren't a big deal. Just waiting in a number of lines on both sides of the border, filling out all the right forms, all taking something like an hour total. The one important thing to know about is that if you plan to take your rental car across the border, you need to notify the rental agency in advance and pay an extra fee (I don't recall exact numbers, but something on the order of $50) to have them put together the extra paperwork you'll need to take the car across the border. Having at least a slight familiarity with the Spanish language helps a lot at the border crossings, or things could get confusing, since I recall that some of the border guards' knowledge of English was no more than rudimentary.
The roads in Argentina between the border and El Chalten were a mix of "recently paved" and "not yet paved" (at least as of a year ago), but the main routes were all OK. (Just stay off the minor roads, which can be pretty bad. It helps to do some web research ahead to time to find out more about conditions of various roads. And have a good map, preferably two different maps, since they aren't as reliable as the ones we're used to around our part of the world.) Some of the roads in Torres del Paine (I'm especially remembering Lago Grey) were bad enough I wouldn't have wanted to do them in anything but a 4WD. I'd recommend having a car at Paine; there are great viewpoints and trailheads all over the park, and I believe you'll need a car to get to some of them (unless you opt to stay at a hotel there and take their local tours). Of course, if you only stay for a day or two you won't run out of things to do wherever you stay, but I strongly recommend staying longer and seeing more of the park (we were there for about five days, and that felt about right). There's a lot to do there, and, as someone above pointed out, it can sometimes take several days for the clouds to clear enough to get a good view of the mountains. Get reservations *early* there, too, if you plan to stay at one of the hotels - last year, they filled up very early, and we had to split between two different places despite getting our reservations about three months in advance...
A car is much less necessary in El Chalten. The town is relatively small, and the main trailheads leave from in or near town. Still, if you're tired and sore from hiking all day, that car might be much appreciated for getting you that half-mile to dinner at the restaurant across town you wanted to eat at! (I should point out here that the best views of FitzRoy and the other best mountains are not from town, but from out on the trails. If you don't want to hike, El Chalten is substantially less interesting.)
Our experience last year was that fuel for your car in Chile was easily available but expensive, while fuel in Argentina was dirt cheap but stations often are short and won't sell you more than a little to get you to the next town (unless something unusual was happening the week we were there, which is always possible). If that or the border crossings would be a big source of stress for you, then you might be better off with the bus in Argentina.
If you have any other questions I can help with, just let me know.