Starwood Preferred Guest - How many rooms held back for manager's discretion?

Last night, I went online to make a reservation at the Sheraton in Palo Alto. To my horror, I found it sold out. I called, to ask about a possible wait list. They told me to leave a message for the manager, and ask him what he could do. They told me they were sold out, and that their sister hotel, the Westin, was oversold. However, they said that it might be possible for the manager to get me a room. So I called and left the message. Today, I get a call back, not only did he get me a room, but was able to get me my corporate discount, so I was paying less than the rack rate as of a week ago :D. So I'm just wondering, when they say "sold out" what does that really mean, and how much power do the managers have as far as holding rooms back? Also, is it weird to get this treatment as only a gold, and not a platinum? Not that I'm complaining :). And here I was, contemplating going for HH diamond this year instead of SPG platinum. . .

It means they are (1) willing to walk someone, and (2) figuring there will be X% no-shows and/or cancellations between now and then, knowing the risk is they will pay $Y if everyone shows up to put the people up elsewhere.

Like Eastbay1K said.
Hotel managers never hold rooms back, but they gamble on the fact that there will be last minute cancellations and no shows. And if there aren't, they will walk someone (a low rate someone usually) out with profuse apologies and a nice Starpoints doggie bag

Well, now I know that SPG gold is worth more than HH gold. I actually almost got walked as HH gold this past Fall, whereas with SPG gold, they are willing to walk someone for me.

Well, now I know that SPG gold is worth more than HH gold. I actually almost got walked as HH gold this past Fall, whereas with SPG gold, they are willing to walk someone for me.
I got walked by a Courtyard by Marriott once. I think that I was MR Gold at the time. They put me up in a Doubletree for the night and gave me the night for free and $100 -- a check rather than a voucher, IIRC. I was happy to have the $100, but I was angry that they didn't contact me before my arrival after 1am.

There are a lot of times that I'd be willing to accept a walk if the hotel would call me. Too bad the hotels don't provide a "volunteer" indicator on the customer profile. As status goes up, my volunteer opportunities go down, I guess. Does any hotel take "volunteers" rather than pick on the unsuspecting non-elite, the lowest price buyer, or the latest arrival?

I got walked by a Courtyard by Marriott once. I think that I was MR Gold at the time. They put me up in a Doubletree for the night and gave me the night for free and $100 -- a check rather than a voucher, IIRC. I was happy to have the $100, but I was angry that they didn't contact me before my arrival after 1am.

There are a lot of times that I'd be willing to accept a walk if the hotel would call me. Too bad the hotels don't provide a "volunteer" indicator on the customer profile. As status goes up, my volunteer opportunities go down, I guess. Does any hotel take "volunteers" rather than pick on the unsuspecting non-elite, the lowest price buyer, or the latest arrival?

I like the idea of a "volunteer" option. But I'm not sure it's as workable for a hotel as for an airline. As I understand it, the hotel wouldn't exercise its option to walk you until someone appears at the desk to check in after all the rooms are already occupied. This would mean that a volunteer might find himself being awakened at 2 a.m. by the front desk with the message, "We're accepting your offer to walk, so please vacate the room immediately because Mr. Smith needs it right away."

I doubt that scenario would be a happy one for the hotel or the volunteer or even Mr. Smith, who would likely get a room that hadn't been cleaned.