They literally bought the upgrade to Y+ for 100$ (at least that's what they claimed many times - and if they paid more for it, I'm very, very sure they'd have said so )

Bulkhead seats are AT LEAST as good as what you get in Y+.

So they got the features of the product they up-sold themselves AND the money back.

I do agree that Air China should have a better system in place to catch any aircraft swaps where Y+ isn't available anymore, to simply hand out a reasonable amount of cash upon boarding or having an easy process in place (like setting a WeChat /e-mail account set up for this, who then would handle any such requests) so that there simply wouldn't any space for complaints.

But when even airlines who do run a proper Economy Comfort class do NOT even consider to put the pax into C when they've an aircraft swap (I know that from Lufthansa and SQ for guaranteed) and will happily assign you whatever left in Y cabin (mind you, Air China DID made sure to give them the best Y seats available, again, better/at least as good than Y+ in fact) with a minimal compensation.

ONLY if there are no free seats in Y they'll upgrade pax from Y+ to C.

Then why should Air China, who are basically running their Y+ seats as "slightly more legroom" (as do some other carriers - always worth checking what you actually get with Y+) hand out free upgrades to C?

I think the fact that they were US-Americans actually plays a bit into the "but I should get an upgrade" argument, since the US domestic system still works in that - in my eyes rather silly - way, that frequent flyers are getting upgraded for free if there are seats available. But that's something very, very much us-specific, and definitely shouldn't find it's way into international travel since it basically dilutes C/F class massively.