Judging from this one line, your whole story is flawed already:

"At the time when Mr. P called us, we looked at the availability of AC 7 on Sabre. There were still 1 J class seats and many economy seats available for sale (hard copy available for proof.)"

Airport has full control of the inventory 4 hours before departure so what is seen on Sabre is completely inaccurate. Lots of 'think' in that story meaning it was not facts. And when people are upset, they will usually make up a lot of things just to make themselves look good and put the blame on the airline.

Still suffering from pain on that 762?

And btw, I've seen what I described above happen first hand through the entire process and I've also been offered that option. Safe to say I've been on MANY more HKG flights than you have so what I've posted is first hand where as what you posted is what you 'heard' or should i say what you think you heard.