Thanks for highlighting this persistent problem. I know it most likely won't do any good, but having experience similar problems I emailed the following to United 1K. (Talk about wishful thinking!):
I have been a loyal United 1K customer for years and continue to frequently fly on United, but have started to fly other airlines recently.
Here is one reason why: I have experienced and completely agree with the frustration you will find if you go to
http://www.flyertalk.com/ and then to the following "United has got to fix upgrading someone else's ticket" thread, pasted in at the end of this email. Personally, the kind of frustration you find here and the fact that it is so systemic adds fuel to the fire of myself and others flying American and other UA competitors more. As you will see from one of the posts on the thread, American customers do not seem to have this kind of problem. And even if they do, that is no excuse for United to create such problems for its customers and ultimately itself.
I urge you to review this thread. And please come up with a simple, clear, verifiable system for MP members to upgrade friends and family, whether using miles or electronic upgrades. You might start by training your airport ticketing and check-in personnel to understand your (hopefully improved) system better and by providing a way for MP members' friends and family to obtain written confirmation that they have been upgraded by an MP member, just in case there are questions at the airport. As you can see from the thread, even a reservation print-out does not preclude problems.
I don't know whether these problems are simply a product of UA not bothering to invest some time and thought in fixing its system or whether management sees the problems as a way of saving money by discouraging use of upgrades. Either way, United may think it is saving money by making this process such a hassle, but you really are alienating customers and losing revenue!
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United has got to fix upgrading someone else's ticket