I think it's pretty clear by now that we have established that there are some processes in place that allow non-elites to get benefits that were marketed to elites, and lower elites have regularly the ability to jump over higher elites. We have established that there are a bunch of loopholes that have not been patched (some of them in place for years). Then, there are the tales of shenanigans.
In the meantime, CO is generating extra revenue from buy-ups and gives itself more "flexibility".
Unlike other posters here, I don't give CO the favor of the doubt at all. If I thought for one moment that they had any intention of fixing a broken system or process, I believe they would have the resources to do so. The fact that nothing has been done to address the persistent issues we all see and report here makes it very clear what CO's stance on this issue is.
Things are EXACTLY how they want them. The process works as designed and by its sheer complexity, it is nearly impossible to know for regular and frequent flyers alike, whether their system is working as designed, or if it malfunctioned. The beauty is that CO gets to trot out both sides of the story.
If a pax gets upgraded, the system "worked as it should". If squirrely situations arise, then the system isn't working.
COInsiders total silence on this issue is deafening and the most obvious sign that the upgrade process works exactly as CO wants it to.
Frequent flyers are not retarded though. If they keep up the current system, they will lose tons of frequent flyers who will then only fly them if their ticket is far cheaper than the competition. That will put pressure on yields long term.
Good luck with that business strategy.