Heard back from Hertz senior management - as we suspected, Twitter team was wrong.
Here's how it works:
Compact or subcompact (regardless of status): choose from the Compact area.
Midsize to fullsize:
*PCs can choose anything from the PC, 5*, Compact, or Midsize areas. Or pay for an upgrade from the Premium Upgrade or Ultimate Series areas.
*5 Stars can choose anything from the 5*, Compact, or Midsize areas. Or pay for an upgrade from the Premium Upgrade or Ultimate Series areas.
Above fullsize, or specialty (SUV, Minivan, etc.): car will be assigned and in a marked space. (Didn't ask whether you can choose something else from the PC area, but I presume you could, i.e. book an SUV, get assigned one, choose an Impala from the PC area instead).
So, basically, almost exactly like National's Emerald Aisle/Executive Selection.