I think that is nonsense, and I would go higher. You may not get a better answer, but you should.
I think it would help if you could show them a flight history of only going to IST -- meaning that you aren't just trying to weasel out of the purchase, this is the real reason you are cancelling. You could also point out that there was a period of about 4-8 weeks before the route was cancelled that it was unbookable. Effectively they sold you a pass for something you couldn't book for 2 (?) months.
Flight pass rules are breakable. Simply citing the rules and saying they are absolutely strict about never breaking them is not true. I am certainly not going to post the hows and whys here, but in some circumstances AC can be flexible with the FP rules.
So I would go higher.