Once you are on board, the FA are NOT allowed to let you sit in any class other than the one you are B/P'd for unless something "extraordinary" happens, like you help with a medical emergency and the like.

As far as boarding while still waiting for an upgrade, at my station, if you board we still clear the upgrade list my priority, even if you're already on board... I've fought many an aisle to deliver a new BP to a boarded in Y class customer to move them up to an F seat. But we always do things strangely like that here in BUF, so YMMVG.