Here at FT we're all fairly upgrade obsessed. At least I know I am

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But the one area where I regularly hear complaints about upgrades is with rental cars. This is a perfect example. If I had reserved a Mazda 6 and got a Subaru Outback, I'd be happy. If I reserved an economy seat and was upgraded to a UA First Suite, I'd be even more excited.
That said, there are situations where the reserved car is desired -- fuel efficiency, ease of parking, or in the case of the OP "I don't drive station wagons or mini vans". The problem is that Hertz thinks it is doing you a favour by giving you the upgrade, and while that might generally be true, there are bound to be some situations where the upgrade doesn't do you any good. I'm kind of surprised the OP took the Grand Marquis over the Subaru (a much larger car) but in the end it doesn't matter -- they did not get what they had reserved.
What can be done about it? In reality, not much. You could reserve an even smaller vehicle and hope to be upgraded to a Midsize. Or, thank the agent for the upgrade, ask if they have any smaller cars available, and if then don't go on your way. Or, you could throw a fit. My advice, however, is to suck it up and let the upgrade gods smile upon you -- be it in a hotel room, rental car, or from Y to F. Trying to give away your upgrade might make them angry and you'll forever be sitting in that Y seat and staying in the small hotel room with a view of the dumpster.