This is the most doofus policy. But the fact is...if you are savvy enough to know the difference between checked in full and boarded full, and the upgrade meant enough to you, then you should have followed up with a "yes, but has FC actually fully boarded?" You can say it's not your job to educate the GA all you want, but...
I know, I know...it's a total pita. But that's how the current system is. You get to play roulette with overhead bin space in Y versus getting a shot at the last banana from the snack basket in F.
At least the guy who got the UG actually outranked you on the list. You could have gamed him and gotten the seat yourself, but at least there was no Sheena.