Nothing in the original post seems inappropriate as far as how an airline should handle things, in 99% of all cases. What matters is how many hoops must be jumped through to take care of the 1% where he normal handling would be inappropriate. But as far a how things are supposed to work from an operations standpoint, it makes perfect sense.

Of course, what's at the heart of all such matters is whether there's an actual hierarchy to paid tickets in C or F, CPUs, and upgrades using instruments.