I personally thought that it was a promotional offer, to gain market share in the Spanish market. I bought the tickets, and I made an enquiry to be sure that Etihad was for real and I was holding valid tickets. They answered me by email that they would honor the reservations. ^
What upsets me is not the fact that they downgrade or cancel the tickets after they realise their mistake. What annoys me is the fact that they enter into a binding contract (their confirmation e-mail voids any claim of invalidity due to "obvious mistakes") and then 10 days later they decide to cancel the contract unilateraly.
For an airline this is a great business model: sell tickets at a discounted price; if you see that demand increases and you will be able to sell the same seats at a higher price, then cancel the previous reservation; otherwise, take the money from the first client, because he is not allowed to cancel unilaterally. Luckily for us, this is illegal in Europe AFAIK.